European CO₂ emissions persistence analysis: A comparative IPCC-contributor study with fractional integration

Abstract

This paper investigates the persistence of CO2 emissions in the largest European economies (Germany, France, Italy, Spain, and the Netherlands) from 1970 to 2023 by using a fractional integration framework. With this purpose, we contribute to the existing literature by investigating two research questions. First, to assess persistence in the specific subsectors, organized by Intergovernmental Panel on Climate Change (IPCC) standard categories; and second, to study their cross-country and cross-sectoral long-term and short-term relationships. The main findings suggest clear evidence of persistent patterns in emissions and their associated components, with a significant negative trend in all cases except France. Regarding the relationship between crossed components, we find evidence that transportation and industry demonstrate a high degree of correlation, yet no evidence of cointegration is observed. Conversely, waste shows a high level of cointegration across countries but no correlation. We find different patterns for the remaining components, with no discernible relationship observed across sectors within a single country or across different countries for the same sector. These findings suggest that despite the EU's substantial commitment to reducing carbon emissions, there appears to be no coordinated strategy across the different countries to fully implement these policies.