Macroeconomic Drives of Carbon Emissions in Jordan

Abstract

This study investigates the dynamic relationship between carbon dioxide (CO₂) emissions, economic growth, energy consumption, and population in Jordan using annual data for the period from 1990 to 2022. A Vector Error Correction Model (VECM) is employed to examine both long-run equilibrium relationships and short-run adjustment dynamics. The results confirm the existence of a stable long-run relationship among the variables. Economic growth and energy consumption are found to exert positive and significant effects on CO₂ emissions, with energy consumption emerging as the dominant driver. Population growth also contributes positively to emissions, though to a lesser extent. Short-run dynamics and impulse response analysis reveal that shocks to energy consumption produce the most persistent upward effects on emissions. Overall, the findings underscore the dominant role of fossil-fuel-based energy use in driving emissions in Jordan and highlight the need for policies that promote energy efficiency and renewable energy to support sustainable growth.