Energy Strategy Reviews 21 (2018) 16–24

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Energy Strategy Reviews

journal homepage: www.elsevier.com/locate/esr

Impact of fossil fuels energy consumption, energy policies, and urban sprawl T
on carbon emissions in East Asia and the Pacific: A panel investigation
Imran Hanif
Department of Economics, NUR International University, Model Town, Lahore, Pakistan

A R T I C LE I N FO A B S T R A C T

Keywords: This paper employs the Environmental Kuznets Curve (EKC) hypothesis in studying the impact of energy con-
Carbon emissions sumption, economic growth, and urbanization on carbon emissions in developing economies. Data from twelve
Energy consumption developing East Asian and Pacific countries for the period 1990 to 2014 has been used for analysis. The empirical
Energy management results, estimated through application of the System Generalized Method of Moment (GMM), show that energy
Economic growth
consumption, economic growth, and urbanization all significantly increase carbon emissions, thereby adding to
Urbanization
serious environmental challenges in the region. Moreover, public policies designed to shift economies from non-
renewable to renewable energy resources have been taken into account, and their impact was found to have been
insignificant in the sampled countries. However, the results depict an inverted U-shaped relationship between
per capita economic growth and carbon emissions, confirming the existence of an EKC in the region. The em-
pirical findings suggest that energy conservation and policies fostering use of renewables helped to improve
economic growth, control carbon emissions, and support the rising energy demand resulting from increased
urban sprawl. In order to improve the influence of public policies in controlling carbon emissions, our analysis
finds a need for stronger initiative to be taken in regional dialogues and policy frameworks, and for greater
collaboration among diverse stakeholders often characterized by differing values, interests, and objectives.

1. Introduction industrialization and growth but overlooking negative externalities

The promotion of industrialization in developing economies, to
improve the production of goods and satisfy the demands of growing
populations, is seen as inevitable to such nations' economic progression.
Corresponding advances in technology have resulted in massive pro-
duction increases but have also created new challenges in the form of
rising demand for energy, increased pressure on natural resources, and
issues of solid waste management and carbon emissions. For example,
the waste generated per day in the East Asia and Pacific regions was in
2013 estimated at around 760,000 tons per day, and this is expected to
intensify to as much as 18 million tons per day by the year 2025
[9,36,67].
Over the past few decades, the social benefits accrued from the
exploitation of biotic systems have been sharply declining. Thus the
need has arisen to tackle resource depletion in a serious way; if humans
continue to consume natural resources at the current rate, the planet
will no longer be able to meet the growing demand [29–31,47,72].
Meanwhile, economic growth is seen as essential to promoting devel-
opment and to coping with issues such as poverty, unemployment, low
per capita income, and health concerns. As a result, developing coun-
tries are consuming resources voraciously, in pursuit of
generated by consumption. In order to speed economic growth, devel-
oping countries are meanwhile dependent on consumption of non-re-
newable fossil fuels (which, apart from exerting pressure on limited
resources, produces enormous volumes of noxious gases such as carbon
dioxide, nitrous oxide, and methane). Alarmingly, the East Asian and
Pacific region as a whole has lost 70 to 90% of its original wildlife
habitat – particularly in Indonesia, Cambodia, Vietnam, and Thailand.
In just a few decades, due to infrastructural and agricultural develop-
ment, land degradation, deforestation, shrimp farming, and other
practices, these habitat losses plus rising carbon dioxide levels in the
atmosphere have brought the region to a crisis point [65].
Carbon dioxide is considered the global pollutant chiefly re-
sponsible for global warming and climate change [41,4,15,16,22,23].
In global terms, 75% of total greenhouse gases consist of carbon di-
oxide, and these gases do not dissipate or vanish, but merely move from
one zone to another, remaining within the biosphere for thousands of
years. Higher absorption of carbon dioxide in sea water converts into
carbonic acid, which increases the acidity of oceans and damages coral
reefs and other marine life [20]. Beyond being the main source of
carbon dioxide in the air, the use of fossil fuels also creates acute health
problems. According to the World [64]; greenhouse gas emissions from

E-mail address: ihanif@gsu.edu.

https://doi.org/10.1016/j.esr.2018.04.006
Received 7 November 2017; Received in revised form 7 April 2018; Accepted 15 April 2018
Available online 24 April 2018
2211-467X/ © 2018 Elsevier Ltd. All rights reserved.
I. Hanif Energy Strategy Reviews 21 (2018) 16–24

Table 1
Averages of Key Indicators in East Asia ans Pacific (1990-2014).
Source: Based on World Bank Data (1990−2015)
Countries CO2 Emissions (Kilotons) Environment Rating (Rating points) Energy Use (Kg of oil) Fossil Fuels Use (% of total) GDP Per Capita (in US$) Urbanization
(in millions)

Cambodia 2558.72 1.25 220.77 17.88 529.72 9.31

China 4751043.01 1.06 1124.43 75.69 2793.61 17.09
Indonesia 296428.41 0.21 673.41 57.24 2560.52 10.21
Korea Rep. 40396.94 1.24 850.57 82.51 586.92 12.02
Lao PDR 900.24 1.57 301.03 80.87 839.64 9.32
Malaysia 135414.81 0.78 2018.96 85.92 7553.05 17.73
Mongolia 11973.88 1.31 1177.93 87.74 2166.44 35.21
Myanmar 8603.91 0.28 253.31 22.02 569.43 10.27
Philippines 63986.19 0.96 427.97 50.67 1825.93 14.39
Thailand 190579.81 1.02 1212.08 71.71 4101.53 12.19
Timor-Leste 103.09 0.84 9.18 78.92 498.34 8.57
Vietnam 71203.83 1.51 407.13 46.16 964.17 10.22

coal alone are causing about 50,000 premature deaths and 0.4 million
new cases of bronchitis every year. In the past few decades, due to these
environmental changes, noxious hazes are also on the rise in the region,
causing serious safety and health concerns – particularly in Indonesia,
Thailand, Malaysia, Brunei, and Singapore. These rapidly increasing
hazes are perilous for local inhabitants, adding further economic costs
to the list of negative consequences. Consequently, populations from
developing East Asian and Pacific nations have grown more sensitive to
environmental damages and are demanding well-defined policies to
preserve the natural environment. Considering the consequences of this
burning issue, the developing countries of East Asia and the Pacific are
now addressing various environmental concerns as cross-border issues.
In the context of such efforts, there is a dire need at the regional level to
observe the Environmental Kuznets Curve (EKC) test results and to
inspect the impact of non-renewable energy consumption, energy
management policies, and urban sprawl on carbon emissions – which
the present study undertakes to do.
A sizeable literature has already determined the impact of economic
growth and fossil fuels consumption on carbon emissions, including:
[1,3,6,18,23,31,43,46,59,60,67,38,13,34]. Additionally, individual
studies have focused on different pollutants [26,27] used sulphur di-
oxide emissions [54]; examined sulphur dioxide and nitrogen oxide
[31,60,6] all examined CO2 emissions to determine the impact of eco-
nomic development on environmental degradation. Moreover, many
studies have employed a Granger causality test and reported unidirec-
tional as well as bidirectional causalities between economic growth and
carbon dioxide emissions for various regions
[40,14,41,49,25,50,51,55,4]. Empirical findings are inconsistent due to
variations in time-span, indicators examined, regions or countries se-
lected, and models followed; thus the empirical evidence is still seen as
inadequate for recommending effective policy to improve energy effi-
ciency and environmental quality, particularly in the East Asian and
Pacific economies.
The present study is an attempt to draw together analyses of the
impacts of fossil fuels consumption, per capita growth, and energy
management policies on carbon emissions in these developing coun-
tries. In addition, we consider the rising pace of industrialization and
rural-to-urban migration, which exert increasing strains on natural re-
sources via increased consumption of energy, foods, and other goods,
and which are equally imperative in determining the impact of growing
urbanization on carbon emissions in these developing countries.
Furthermore, very few studies have so far addressed energy manage-
ment, energy consumption, and carbon emission issues in terms of East
Asia and the Pacific; the present study hopes to fill that gap in the lit-
erature by using the most recent panel data for the period 1990 to 2014.
Generally speaking, variables of energy consumption, growth, and
urbanization are seen to ‘cause’ one another, but simultaneity becomes
an unavoidable problem in the case of bidirectional causality, and an
estimation model may lead to biased results. Moreover, carbon emis-
sions are a product of energy consumption as well as other factors,
known and unknown; the omission of any important indicator in model
construction may lead to mis-specification bias. Quantification of the
impact of energy consumption, energy policies, urban sprawl, and
economic growth on carbon emissions is tricky and demands effective
control over simultaneity and mis-specification bias in the model. Thus,
a methodology based on a two-step System Generalized Method of
Moment (GMM) has been adopted to tackle problems of simultaneity,
measurement error, and omitted variable bias, in order to report the
most concentrated results and to suggest effective and efficient policy
frameworks for controlling carbon emissions. Our empirical findings
confirm an inverted U-shape relationship between per capita real GDP
and per capita carbon emissions in the East Asia and Pacific region. The
results further depict an insignificant influence of environmental
management policies toward achieving sustainable development and
toward controlling carbon emissions in East Asia and the Pacific, and
elsewhere.
The following section explains our data and methodology. Section 3
estimates results, section 4 interprets those results, and section 5 pre-
sents the conclusions.
2. Data and methodology
Energy is essential for economic progress as well as for the attain-
ment of sustainable development. However, it is prerequisite of sus-
tainable development to foster economic growth without harming the
environment. Commonly, developing countries are facing multi-fold
challenges to improve economic growth. Owing to antiquated tech-
nologies, developing economies are bound to make excessive use of
fossil fuels in order to meet the growing demand for energy and to
produce more goods. Such economies are therefore experiencing stag-
nant economic growth while contributing ever more towards the gen-
eration of toxic gases, excessively consuming fossil fuels and adding to
environmental decline in the form of air and land degradation. As a
general summary of statistics concerning the economies in East Asia
and the Pacific, the average values of carbon emissions, fossil fuels
consumption, economic growth, and urbanization are reported in
Table 1.
In addition, the East Asian and Pacific regions are highly vulnerable
to climate change owing to their geography, climate, socioeconomic
conditions, and demographic factors, as well as to the great sensitivity
of their natural assets (such as forests and biodiversity) to climate
change. Rising emissions of carbon dioxide are endangering species,
increasing air pollution, causing damage to coral reefs, and increasing
deforestation and water insecurity. Our summary of key environmental,
economic, and demographic factors in Table 1 allows assessment of the
heterogeneity of the countries included in the panel.

17
I. Hanif
The panel consists of the twelve developing countries of East Asia
and the Pacific, namely: Cambodia, China, Indonesia, the Korean
Republic, Lao PDR, Malaysia, Mongolia, Myanmar, Philippines,
Thailand, Timor-Leste, and Vietnam. Other developing countries such
as American Samoa, Fiji, Kiribati, Marshall Islands, Micronesia, Palau,
Papua New Guinea, Samoa, Solomon Islands, Tonga, Tuvalu, and
Vanuatu have not been considered due to data deficiency. Therefore,
this study has used unbalanced panel data from twelve developing
countries of East Asia and the Pacific for the period 1990 to 2014. Data
were collected from the World Bank's World Development Indicators
(WDIs) and from the annual reports of Environmental Protection
Agencies (EPAs).
Considering the objectives of the study, we have used the log of
yearly per capita carbon dioxide emissions (ED) in kilotons as a de-
pendent variable. The log of real annual per capita economic growth
(EG) in 2010 US$ and the log of the square of annual per capita eco-
nomic growth (EG2) were used to examine the impact of economic
growth on carbon emissions, and to test the Environmental Kuznets
Curve hypothesis for these East Asia and Pacific economies. Moreover,
to examine the impact of non-renewable energy consumption, the log of
annual per capita fossil fuels energy consumption in kilograms of oil
equivalent (EC) was used as an independent variable. Similarly, to ex-
amine the influence of urban expansion (UE) on carbon emissions, the
log of population growth in urban agglomerations of more than 1
million was used. Finally, to examine the impact of energy management
policies (EP), the logs of yearly country ratings based on the quality of
energy management policies and quality of institutions for sustain-
ability were employed in the model. The effectiveness of energy policies
and the quality of energy management policies for environmental sus-
tainability assess the extent to which energy policies have fostered the
protection and sustainable management of pollution [65]. Assessments
of the effectiveness and quality of energy management policies were
made on the basis of multidimensional criteria based on energy pro-
duction by water, air, and the consumption of fuels, including bio fuels,
and their influence on environment. The country-wise summary of
dependent and independent variables based on average data is given in
Fig. 1.
For the purpose of empirical investigation, and to construct the
model, the study used a transformed functional form of the EKC based
on the work of [29–31,58]. The simplest function form of our estimated
model can be written as follows:
ED = f (EG, EG 2, θ)
The generalized form of econometric model based on the EKC can
be described as:
EDit = β0 + β1 EGit + β2 EGit2 + Ψnπit + μit
In equation (1), πit represents the additional set of independent
variables and Ψn is the slope of n number of independent variables,
while μit shows the idiosyncratic error term. Finally, our examination of
the impact of energy management policies, non-renewable energy
consumption, economic growth, and urbanization on carbon emissions
in the East Asia and Pacific region can be written as:
log EDit = β0 + β1 logEGit + β2 logEGit2 + β3 logECit + β4 logURit + β5 logEPit
+ μit
In equation (2) the log transformation is used because it is expected
that per capita real GDP (EG) and carbon emissions (ED) do not have a
linear relationship, and may have an exponential relationship. Here, to
test the EKC, the impact of per capita real GDP on per capita carbon
emissions is determined, and it is expected that a proportional increase
in per capita GDP would increase the carbon emissions to a certain
level, beyond which the increase in per capita GDP would either flatten
or decrease the level of carbon emissions. Moreover, the log transfor-
mation helps to reduce the problem of multicollinearity [8]. Therefore,
Energy Strategy Reviews 21 (2018) 16–24
the logarithms are used to examine the impact of independent variables
(which are measured in different units) on carbon emissions to examine
changes in percentage, rather than unit changes.
3. Empirical testing
Summary statistics of dependent and independent variables without
logarithm are given in Table 2. The average value of carbon dioxide
emissions was found to be 540,682.9 kilotons (kt), with the highest
figure reported in China in 2013 (about 10,249,463 kt) and the lowest
in Timor-Leste in 2002 (about 161.34 kt). In the developing economies
of East Asia and the Pacific, the average value of per capita economic
growth for the period reached about US$ 2315.55. The highest per
capita gross domestic product was around US$ 10,878.39, reported in
Malaysia, while the lowest was in Myanmar, at about US$ 186.9 for the
year 1991. The average value of per capita energy use reported about
911.17 kg of oil equivalent; the highest such value was reported in
Malaysia, at 3019.81 kg of oil equivalent in 2013, while the lowest was
in Timor-Leste, at 59.23 kg of oil equivalent in the year 2005. Similarly,
the average value of urban agglomeration (of more than 1 million) as a
percentage of total population was approximately 14.86%; the highest
value was reported in Cambodia (around 51.04% in 1993) while the
lowest was reported in Mongolia (about 1.91% in 2015). As far as en-
ergy management policies are concerned, the lowest effect on en-
vironmental degradation was reported in Timor-Leste during the period
2011-15, while the highest value was reported in Lao PDR for 2008-12,
and also in Vietnam for 2014-15. For further details, the country-wise
summary statistics are reported in Appendix 1.
The results of a pairwise correlation matrix are reported in Table 3,
presenting the intensity of multicollinearity among the regressors. The
results show that carbon emission (ED) is weakly correlated with per
capita economic growth (EG), the square of per capita economic growth
(EG2), fossil fuel energy consumption (EC), urbanization (UR), and
energy management policies (EP).
To avoid a spurious regression result, it is necessary to determine
the stationarity level of the selected variables. The study used a Fisher-
type unit root test to determine the stationarity in the data series, and
the results are reported in Table 4.
The results of the Fisher-type unit root test reject the null hypothesis
and show that all the data series are stationary at level. Therefore, we
can estimate the model using the appropriate regression technique,
though it is also necessary to deal with endogeneity in the model. To
test the endogeneity, we used the Durbin-Wu-Hausman test, and results
are reported in Table 5.
The lower p-values are an indication of acceptance of an alternative
hypothesis, thus confirming endogeneity in the variables. Because our
(1) data is cross-country and data series may suffer from heteroscedasticity,
the Breush-Pagan test for homoscedasticity was applied to control the
outliers, and its results are reported in Table 6. The lower p-values
reject the null hypothesis, which shows that the data series do suffer
from heteroscedasticity.
The study used a robust version of System GMM, generally re-
commended to control heterogeneity in the presence of endogenous
explanatory variables. Because the result of the Durbin-Wu-Hausman
test shows that the explanatory variables in the estimated model are
endogenous, and thus correlated with the error term, the Fixed Effects
(2)
(FE) are therefore inconsistent [66]. Moreover, the variables used in the
model are stationary at level, but the use of OLS will not consistently
estimate the coefficient unless there is no heterogeneity, and there may
be an upward bias. FE is also biased, usually downward, and the bias
can be substantial unless the T is large. However, GMM using the
Arellano-Bond conditions is considered the most robust: it employs only
the moment conditions implied by the AR (1) model, and it properly
removes heterogeneity. System GMM adds extra moment conditions
that may be false, so it is important to mention that if the System GMM
estimate seems reasonably precise, and there is no evidence of weak
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I. Hanif Energy Strategy Reviews 21 (2018) 16–24

Fig. 1. Trends of dependent and independent variables (averages, 1990-2014).

Table 2 Table 3
Summary statistics. Correlation matrix.
Variables Obs. Mean Median Maximum Minimum Std. Dev. log ED log EG log EG2 log EC log UR log EP

ED 268 540682.9 65565.96 10249463 161.35 16357.48 log ED 1.00

EG 274 2315.55 1550.48 10878.39 186.91 2205.22 log EG 0.18 1.00
EG2 274 10207037 2404072 11808001 34932.2 19566.66 log EG2 −0.11 0.68 1.00
EC 269 911.17 788.12 3019.81 59.23 638.49 log EC 0.14 0.36 0.48 1.00
UR 260 14.86 12.13 51.04 1.91 7.91 log UR 0.33 0.39 0.42 0.33 1.00
EP 269 3.08 3.00 4.00 2.00 0.58 log EP −0.23 0.01 0.03 0.17 0.11 1.00

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I. Hanif Energy Strategy Reviews 21 (2018) 16–24

Table 4
Results based on fisher-type unit root tests.
Ho: All panels contain unit roots

AR parameter: Panel-specific Number of panels = 12

Panel means: Included Avg. number of periods = 21.67
Time trend: Not included Cross-sectional means removed
Drift term: Included ADF regressions: (0) lags
log ED log EG log EG2 log EC log UR log EP
Inverse chi-squared P 131.23 63.41 51.78 71.34 84.82 62.91
Inverse normal Z −5.45 −4.82 −5.61 −5.81 −6.48 −4.32
Inverse logit-t L* −7.12 −4.52 −6.43 −6.81 −7.32 −4.61
Modified inv. chi-squared Pm 31.73 14.72 9.93 19.24 36.82 17.72

Table 5 Table 7
Tests of endogeneity. Results of two-step GMM (robust) estimation.
Dependent Variable: log ED Independent Variables: log EG, log EG2, log EC, log UR, log EP Dependent variable = log ED

Durbin (score) chi2 (5) = 29.91 (p = 0.04) log EG 1.947***

Wu-Hausman F (5,260) = 34.72 (p = 0.01) (0.859)
log EG 2 −0.114**
Note: The lower p-values reject the null hypothesis. (0.061)
log EC 2.59***
(1.074)
log UR 1.264***
Table 6
(0.518)
Test for Heteroscedasticity. Note: The results of Bresush-Pagan test reject the −0.887
log EP
null hypothesis of constant variance in equation (2). (0.562)
Con 5.082***
Dependent Variable: log ED Independent Variables: log EG, log EG2, log EC, log UR, log EP
(1.794)
Chi2 (5) 33.92 EKC turning-point $5112.65
Prob > chi2 (0.003) Observations 260
Instruments 11
Wald chi2 (5) 1174.03
Prob. 0.000
Hansen J-test 0.183
instruments, the results will be reliable [12,35,37]. Therefore, the Difference-in-Hansen test, P-value 0.161
present study used a two-step GMM method, the flexibility of which Arellano-Bond AR (2) 0.209
permits more precise estimation of the parameters as compared to
Difference GMM [7]. recommended the use of a Difference GMM and Note: Here ***’ **’ and * represent the 1%, 5% and 10% level of
proposed first-difference lag variables as an instrument. However, first- significance respectively. Heteroskedastic consistent standard error is
in parenthesis. The p-values of the Hansen J-test and Difference-in-
difference variables used as instruments frequently yield severe devia-
Hansen test show that H0 cannot be rejected at 5%, therefore over-
tional bias, particularly for small sample sizes, and they usually prove
identification restrictions are valid. The EKC turning-point is calcu-
to be poor or weak instruments. Thus [11], suggested the System lated as: τ = exp (−β1/2β2 ).
Generalized Method of Moment, which introduced a level equation on
the basis of a first-difference equation in order to develop a system of
equations. Moreover, in System GMM, instruments are constructed on capita economic growth contributes 1.95% of carbon emissions in the
the basis of differences as well as level information. The introduction of region under question, and our findings are in line with those of
a level equation into System GMM converts the lagged variables of the [30,19,17,21,39,71,49].
level equation into instruments, also increasing the instruments and The results further reported a significant and negative impact of per
therefore providing more information about the sample, as compared to capita economic growth squared (EG2) on carbon emissions (ED).
a Difference GMM. Here we further classify the System GMM into one- According to the results, a percent increase in per capita economic
step and two-step procedures. To deal with heteroscedasticity (as well growth squared decreases carbon emissions by about 0.14% in East Asia
as long periods and a small number of groups), our study used a two- and the Pacific.
step GMM procedure with a robust option to estimate the model. The positive impact of per capita economic growth on carbon
However, as the one-step GMM cannot determine whether disturbances emissions and the negative impact of the square of per capita economic
are sequentially autocorrelated, the two-step GMM including Wind- growth on carbon emissions endorse the Environmental Kuznets Curve
meijer's finite sample correction was used, with the assumption that the (EKC) hypothesis. According to the EKC hypothesis, there exists an
initial condition of the sample remains adequate and informative in the inverted U-shaped relationship between economic growth and carbon
presence of endogenous regressors [62]. Finally, the quality of instru- emissions. Thus the EKC suggests that the rise in economic growth in-
ments was examined by the Hansen J-test, the Differences-in-Hansen creases carbon emissions, but that after a certain turning-point, further
test, and the Arellano-Bond test for second-order autocorrelation. Thus, additions to economic growth reduce carbon dioxide emissions. Our
the results based on equation (2) are given in Table 7. findings confirm the existence of inverted U-shaped relationship in per
capita economic growth and carbon emissions and locate the turning-
4. Results and discussion point at US$ 5112.65 for the developing economies of the East Asia and
Pacific region, thus supporting the findings of [4] and, in general, en-
In Table 7, the results of two-step Generalized Method of Moment dorsing the results of [21,27,31,39,53,60,68,69,26]. Fig. 2 shows the
show that per capita economic growth (EG) has a statistically sig- average per capita GDP growth in each country and the EKC break-even
nificant and positive impact on carbon dioxide emissions (ED) in the point in the East Asia and Pacific region.
East Asia and Pacific regions. More precisely, a 1% increase in per The presence of an EKC in developing countries of East Asia and the

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I. Hanif Energy Strategy Reviews 21 (2018) 16–24

conditions, urban pollution, and problems of solid waste management

are equally formidable. The results of this study endorse the fact that
failures in urban sprawl management can aggravate widespread en-
vironmental and economic ills.
Results reported a negative but statistically insignificant impact of
energy management policies (EP) on carbon emissions (ED) in the areas
under study. Empirical findings show that, although the energy man-
agement policies meant to achieve sustainable development and to
control carbon emissions in East Asia and the Pacific are indeed redu-
cing environmental degradation, at the same time these policies are
inadequate to achieve the desired targets. Although formal environ-
Fig. 2. Ekc break-even and average GDP per capita. mental institutions, regulations, and policies have been designed for the
region, they have unfortunately been implemented with few incentives,
exceptions, or political commitments. In many countries, the integra-
Pacific shows that, at the current stage of economic development, these
tion of energy management policies into sector policies appeared to be
developing economies may be unwilling to invest in carbon control
ostensibly fruitful and influential for pollution control, energy con-
regulations and may consider the environment as a luxury good.
servation, and even sustainable economic growth. However, mechan-
However, when these economies reach the break-even point of per
isms for influential decision-making in early stages and at policy level
capita GDP, their citizens may ask for improvement in environment
are still not present, due to a diversity of local preferences and choices.
quality. This will lead to a transformation from non-renewable to re-
This study highlights that environmental-friendly economic growth
newable energy consumption and the implementation of energy po-
can improve the welfare of society by way of sustainable management
licies to reduce carbon emissions. Hence, in the developing countries of
of natural and environmental resources. However, the insignificant ef-
East Asia and the Pacific, at the current development stage, carbon
fects of energy management policies toward sustainable development in
emissions are expected to increase with the rise in per capita incomes.
the developing economies of East Asia and the Pacific show the fun-
Thus, the empirical results confirm that the pursuit of growth strategies
damental weaknesses in institutional frameworks and energy policy
in developing countries are not giving due consideration to their role in
designs, as well as in financial areas that have rendered development
environmental degradation.
vulnerable. Thus, there is a need to strengthen energy and environ-
The results reported a positive and statistically significant impact of
mental governance, and to embrace public-private partnerships and
fossil fuels consumption (EC) on carbon emissions (ED). More precisely,
community support for sustainable development throughout the entire
if all other factors are considered constant, a percent increase in fossil
region.
fuels consumption increases carbon emissions by about 2.59% in the
East Asia and Pacific region, and this endorses the findings of
5. Conclusion
[5,10,28,33,44,45,52,56,63,57]. As the region under consideration
consists of rapidly growing economies such as Malaysia and China,
This study has sought to demonstrate that economic growth, fossil
massive consumption of fossil fuels is being undertaken to meet rising
fuels consumption, and urban agglomeration contribute to carbon
energy demand, thereby generating additional waste in the form of
emissions, while energy management policies to control carbon emis-
carbon dioxide and other toxic gases. The results reported that, if the
sions and to achieve sustainable development have not been produc-
developing economies of East Asia and the Pacific continue on their
tive. The methodology adopted in the study has highlighted a way to
current path of non-renewable energy consumption to meet energy
mitigate endogeneity and to estimate consistent results in order to ex-
requirements, these regions will rapidly exhaust their supply of natural
amine the influence of energy consumption, urbanization, and eco-
resources; therefore, there is an urgent need to switch to alternative
nomic growth on carbon emissions. On the basis of robust empirical
energy sources. The low cost of fossil fuels (as compared to renewable
findings, we can conclude that a majority of environmental challenges
energy sources) and of oil-based technologies to produce goods are the
in the East Asia and Pacific region are exacerbating due to the absence
key factors in higher fossil fuels consumption in these developing
of effective and efficient energy management policies. Moreover, the
countries, to the detriment of environmental quality. Now is the time
region's natural resource base is declining rapidly, due to poor gov-
for these economies to make a choice between the need for cleaner,
ernance and massive consumption of non-renewables to improve eco-
alternative renewable power sources and the harm that fossil fuels
nomic growth. The findings of this study further spotlight the problems
consumption exerts on the environment. There is clearly a need to in-
exacerbated by unplanned urban agglomeration and by high population
vest in pollution-control strategies at the regional level. For instance, in
pressure in the region. Our study suggests that regional fora should play
the case of Thailand, the annual total cost for air pollution control was
a vital role in enhancing the capacity to learn from developed nations in
reported at about US$ 660 million in the year 2005, projected to reach
terms of good practices, awareness programs, improvements to regional
around US$ 1.5 billion in 2020, while expected benefits were projected
coordination, and the introduction of regulations to deal with energy
at US$ 4.7 and US$ 25 billion for the years 2005 and 2020, respectively
management and environmental challenges. The influence of energy
[65].
management policies to ensure sustainable development in the region
The results depicted a statistically significant and positive influence
can be further enhanced by improving the role of civil society in major
of urban agglomeration (UR) on carbon emissions (ED) in the regions. A
development and environment policies; public bureaucracies should
percent increase in urban agglomeration increases carbon dioxide
open dialogues with civil society at both the macro and micro levels. In
emissions by about 1.26% in East Asia and the Pacific, if all other
addition, the disclosure of environmental information and environ-
factors are considered constant. These results are in line with the
mental education are important elements to supporting public energy
findings of [2,24,31,32,48,61,70,42]. The findings further highlighted
management policies and a transition from non-renewable to renewable
that, apart from rapid economic growth, urban sprawl also carries
energy sources. The engagement of civil society, along with upgraded
significant environmental implications in the region, not least because
information systems, are important factors that can improve the impact
East Asia and the Pacific have higher levels of urbanization growth than
of energy management policies in controlling carbon emissions and
any other region in the world. Although urbanization improves the
fostering sustainable economic growth. For example, in Thailand's new
public welfare by improving the living standards of individuals, en-
constitution, Article 290 supports the role of civil society in resource
vironmental challenges such as the deterioration of public health
management, and the government is also promoting community-based

21
I. Hanif Energy Strategy Reviews 21 (2018) 16–24

programs to deal with environmental and energy conservational issues.
Moreover, there is an urgent need to switch from non-renewable to
renewable energy sources, and to introduce unilateral moves in the
form of tax incentives and subsidies for the installation of equipment to
generate renewable energy. Such moves in the region will prove helpful
in reducing the consumption of fossil fuels, diminishing energy short-
falls, and fostering environmentally friendly economic growth at the
regional level. So far, the East Asia and Pacific region has experienced
great difficulty in this regard due to varying economic, political, social,
and geographical contexts. Likewise, as many prevailing environmental
issues extend across national boundaries, it is imperative that regional
dialogues be held to develop policy frameworks for collaboration
among stakeholders (often with diverse values, interests, and objec-
tives) in order to tackle environmental problems at regional level. In
short, swift economic development and effective control of trans-na-
tional environmental issues in East Asia and the Pacific require regional
as well as sub-regional collaboration, along with equally effective en-
ergy management strategies.

Appendix 1

Table 8
Country-wise Summary Statistics

Name Variables Mean Median Maximum Minimum Std. Dev.

Cambodia ED 0.31 0.32 0.36 0.21 0.06

EG 767.82 760.77 920.31 610.98 96.45
EG2 597821.7 578783.5 846958.7 373300.8 148219.4
EC 29.79 29.09 34.01 27.28 2.28
UR 10.38 10.38 10.86 9.88 0.33
EP 2.94 3.00 3.51 2.02 0.44
China ED 3.99 2.86 7.55 2.16 1.81
EG 2501.17 1985.66 5721.69 730.77 1535.32
EG2 8514875 3949273 32737779 534028.4 9587415
EC 82.01 80.73 88.17 74.83 4.63
UR 16.49 16.86 23.34 9.93 4.22
EP 3.02 2.82 4.71 2.31 0.76
Indonesia ED 1.45 1.39 2.41 0.82 0.40
EG 2459.83 2346.71 3570.93 1652.93 523.61
EG2 6313551 5507200 12751549 2732192 2751406
EC 62.01 62.32 66.69 53.44 3.66
UR 10.19 10.16 10.44 10.01 0.14
EP 2.58 2.50 4.21 1.21 0.86
Korea, Dem. People's Rep. ED 2.94 2.99 3.13 2.63 0.17
EG 3210.91 3199.97 3570.93 2886.64 262.96
EG2 10367577 10245440 12751549 8332722 1697165
EC 89.98 89.98 90.56 89.13 0.52
UR 12.11 12.11 12.32 11.91 0.15
EP 2.82 2.81 4.20 1.81 0.88
Lao PDR ED 0.13 0.14 0.21 0.05 0.05
EG 635.63 627.52 762.83 523.18 79.41
EG2 409706 394067.9 581918.1 273718.4 102100.5
EC 24.81 23.03 34.02 18.62 5.84
UR 37.43 37.43 41.94 32.89 3.05
EP 3.75 3.75 4.01 3.51 0.26
Malaysia ED 5.61 5.69 7.51 3.66 1.04
EG 6866.17 6884.25 8991.76 4789.36 1188.96
EG2 48479465 47396034 80851757 22938048 16534903
EC 92.91 93.23 95.11 89.99 1.68
UR 16.65 17.43 19.99 12.11 2.59
EP 3.43 3.51 4.01 2.02 0.61
Mongolia ED 6.99 4.78 14.54 3.38 4.01
EG 2660.73 2567.68 3698.55 1961.65 560.72
EG2 7362487 6594274 13679290 3848101 3176388
EC 94.68 94.66 96.33 92.99 0.87
UR 40.42 40.46 44.82 35.91 3.02
EP 2.90 3.00 3.52 2.00 0.45
Myanmar ED 0.23 0.24 0.27 0.19 0.03
EG 898.62 879.64 1148.98 657.39 181.96
EG2 835912 773780.5 1320165 432166.6 329837.3
EC 27.39 28.57 31.85 20.95 3.92
UR 12.15 12.11 12.69 11.63 0.39
EP 2.42 2.21 3.51 1.75 0.62
(continued on next page)

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I. Hanif Energy Strategy Reviews 21 (2018) 16–24

Table 8 (continued)

Name Variables Mean Median Maximum Minimum Std. Dev.

Philippines ED 0.88 0.87 0.97 0.77 0.05

EG 1666.99 1620.21 1884.84 1558.91 111.51
EG2 2789988 2625067 3552622 2430182 381962.1
EC 55.82 56.18 57.81 53.06 1.64
UR 14.32 14.22 14.79 14.13 0.22
EP 2.61 2.51 4.03 1.51 0.88
Thailand ED 2.53 2.71 3.07 1.74 0.47
EG 3286.31 3335.55 3705.76 2686.39 321.17
EG2 10892617 11126658 13732680 7216722 2053319
EC 74.74 76.91 78.83 65.09 5.14
UR 10.68 10.69 10.76 10.63 0.04
EP 2.62 2.51 3.75 2.01 0.61
Timor-Leste ED 0.21 0.22 0.25 0.18 0.03
EG 789.98 814.61 938.24 596.35 132.35
EG2 639089 663573.5 880297 355638.6 204182.9
EC 81.39 81.19 81.92 81.03 0.37
UR 11.73 11.67 12.67 10.96 0.61
EP 2.28 2.51 2.51 2.01 0.26
Vietnam ED 1.38 1.31 1.84 0.89 0.32
EG 1187.59 1187.86 1522.48 867.98 215.96
EG2 1453138 1411713 2317963 753393.5 516474.3
EC 62.61 63.64 70.32 52.27 5.73
UR 11.51 11.42 13.58 9.67 1.28
EP 3.21 3.51 3.75 2.00 0.59
Source: Based on World Bank Data (1990-2015)

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