The adaptive Karhunen-Lo`eve transformation (PCA) method for panel data empirical analysis of factors affecting carbon dioxide emissions for countries with different income levels

The article provides an econometric analysis of carbon dioxide emissions’ dependency on a set of macroeconomic characteristics for various sets of countries. The evaluation is carried out by creating a model with fixed effects and eliminating multicollinearity via the principal component analysis. It is demonstrated that GDP development and a corresponding increase in energy consumption (including the consumption of hydrocarbons) leads to an increase in emissions for the all of nations under examination; a reverse bind is identified for FDI, natural gas, and alternative energy. Consequently, adopting measures aimed at attaining sustainable development goals necessitates not only a balanced application of stimulating economic policy tools, along with the enactment of green initiatives at the national level.