Environmental Kuznets Curve: Empirical Relationship between Energy Consumption and Economic Growth in Upper-Middle-Income Regions of China

Abstract

This paper examines the environmental Kuznets curve (EKC) relationship between energy consumption and economic growth in upper-middle-income regions of China with the panel data of 21 provinces from 2000 to 2017. The influence mechanism of socio-economic factors on the EKC of these regions is also detected. The results show that the energy consumption EKC fitting map in these regions conforms to the classical environmental Kuznets curve, which is an inverted “N” type, and the inflection point is ahead and more accurate after adding spatial effects. The direct effect of energy consumption has delayed the inflection point, indicating that the level of industrialization, urbanization, and population density have a significant impact on EKC. At the same time, it is found that the level of industrialization and population density have a positive relationship with energy consumption, while the level of urbanization has a negative correlation with energy consumption. The spatial spillover effect of the indirect effects of total energy consumption, coal consumption, and crude oil consumption shows that the level of industrialization has a significant and negative link with EKC. The increase in the level of industrialization will affect the total energy consumption of neighboring areas and the consumption of coal and crude oil.