Abstract—The aim of this paper is to measure the impact of green energy shares shocks in electricity generation on Gross Domestic Product (GDP) and environmental deprivation, caused by the changes in carbon dioxide (CO2) emissions. To estimate the shocks of green energy shares, the study applies the dynamic test of Impulse Response Function (IRF) under the VAR methodology. The estimated results show that, in future the increasing portion of green energy's shares in electricity generation would have positive impacts on the environment, as expected. However, the hikes of utilization of green energy sources would incur more cost to electricity producers and shrivel up the growth of economies through the expansionary effect of industry's consumption and private capital spending in the economy. Thus, the study could suggest that for achieving higher economic growth, reducing oil, gas and coal especially in the consumption sectors of the economy and shifting towards indigenous resources would have a beneficial impact on the environment as well as on Malaysia’s country balance.
Index Terms—Green energy shares, electricity generation, environmental deprivation, carbon emission, economic growth.
M. Y. Nora Yusmaand and A. L. Nurul Wahilah are both with Department of Finance & Economics College of Business Management & Accounting UniversitiTenagaNasional Sultan Haji Ahmad Shah Campus Pahang, Malaysia Office: +609-4552044 (e-mail: email@example.com, NurulWahilah@uniten.edu.my).
Cite:Nora Yusma Bt. Mohamed Yusoff and Nurul Wahilah Bt. Abdul Latif, "Impact of Green Energy Shares Shocks on Economic Growth and Carbon Emissions in Malaysia," International Journal of Trade, Economics and Finance vol. 4, no. 4, pp. 238-242, 2013.