THE RELATIONSHIP BETWEEN CO2 EMISSIONS AND GDP PER CAPITA, ENERGY CONSUMPTION, INDUSTRIAL PRODUCTION IN THE CASE OF WESTERN BALKAN COUNTRIES

Purpose: This research investigates the relationship among CO2 emission, GDP per capita, energy consumption and industrial production for the Western Balkan countries during the period 2011 – 2022. Design/methodology/approach: The model consists of CO2 emission as a dependent variable, and GDP per capita, energy consumption and industrial production as independent variables. The analysis includes Ordinary Least Square (OLS), Fixed Effects (FE), Random Effects (RE), and Hausman–Taylor IV model. Findings: Results reveal a negative relationship between CO2 emissions and GDP per capita, and a positive relationship with energy consumption, while industrial production is not significant at all. Practical implications: Knowing the relationship between CO2 emissions and GDP per capita, energy consumption, and industrial production could help in projecting the policies that help protect the environment.