Huiming Zhu

Health Care Expenditure and GDP in African Countries: Evidence from Semiparametric Estimation with Panel Data

A large body of literature studies on the relationship between health care expenditure (HCE) and GDP have been analyzed using data intensively from developed countries, but little is known for other regions. This paper considers a semiparametric panel data analysis for the study of the relationship between per capita HCE and per capita GDP for 42 African countries over the period 1995–2009. We found that infant mortality rate per 1,000 live births has a negative effect on per capita HCE, while the proportion of the population aged 65 is statistically insignificant in African countries. Furthermore, we found that the income elasticity is not constant but varies with income level, and health care is a necessity rather than a luxury for African countries.

The heterogeneous effects of urbanization and income inequality on CO2 emissions in BRICS economies: evidence from panel quantile regression

This paper empirically examines the effects of urbanization and income inequality on CO2 emissions in the BRICS economies (i.e., Brazil, Russia, India, China, and South Africa) during the periods 1994–2013. The method we used is the panel quantile regression, which takes into account the unobserved individual heterogeneity and distributional heterogeneity. Our empirical results indicate that urbanization has a significant and negative impact on carbon emissions, except in the 80th, 90th, and 95th quantiles. We also quantitatively investigate the direct and indirect effect of urbanization on carbon emissions, and the results show that we may underestimate urbanization’s effect on carbon emissions if we ignore its indirect effect. In addition, in middle- and high-emission countries, income inequality has a significant and positive impact on carbon emissions. The results of our study indicate that in the BRICS economies, there is an inverted U-shaped environmental Kuznets curve (EKC) between the GDP per capita and carbon emissions. The conclusions of this study have important policy implications for policymakers. Policymakers should try to narrow the income gap between the rich and the poor to improve environmental quality; the BRICS economies can speed up urbanization to reduce carbon emissions, but they must improve energy efficiency and use clean energy to the greatest extent in the process.

The heterogeneous response of the stock market to emission allowance price: evidence from quantile regression

ABSTRACT This paper investigates the effects of the European Union Emission Allowance (EUA)’s price on European carbon-intensive industries’ stock returns based on daily data from April 25, 2005 to July 24, 2017. Utilizing a multifactor market model specification and a panel quantile regression approach, the study tests whether the influences of the EUA price on the stock market are heterogeneous and asymmetric concerning each phase. The results show that a significant negative impact of the EUA price on the stock market is found in the middle- and high-return markets during Phases I and III, whereas in Phase II, the impacts are positive. Additionally, no asymmetric feature of the carbon market effect is shown in Phases I and III, but it shows a strong asymmetric effect across quantiles during Phase II. Some factors such as allocation rules and macroeconomic stability may cause this dissimilarity.