Internet Usage, Human Capital and CO2 Emissions: A Global Perspective

Abstract

Under the background of dealing with global warming, the widespread use of the internet provides a new idea for countries to develop a low-carbon economy at the right time. Based on the panel data of 70 countries from 1995–2018, this paper empirically analyzes the relationship between internet usage, human capital, and CO2 emissions under different levels of economic development by using system GMM and a threshold regression model. The results show that internet usage and human capital are essential drivers of low-carbon economy development, and human capital can inversely regulate the impact of internet usage on CO2 emissions. Internet usage can increase CO2 emissions when human capital is below the threshold value, and it can significantly inhibit CO2 emissions when human capital exceeds the threshold value. In other words, with the accumulation of human capital, the effect of internet usage on CO2 emissions has an inverted U-shaped nonlinear relationship. Furthermore, the empirical analysis of high-income and middle- and low-income countries indicates the hindrance effect of internet usage on CO2 emissions is more evident in high-income countries. For both the high-income and middle- and low-income countries, the relationship between internet usage and CO2 emissions generally shows an inverted “U-shaped” relationship, first rising and then falling as human capital accumulates.