Sectoral analysis of club convergence in EU countries' CO2 emissions

This paper examines convergence clubs for per capita CO2 emissions among 28 European countries in two main activity sectors (Industry and Manufacturing) between 1970 and 2018, with a focus on the energy sector. The method used is the Phillips-Sul log t-test using two ordering criteria to run the algorithm for the panel countries. The first one is using the last observation and the second one uses the sample average. The results of analyses of data strongly support the existence of convergence clubs, indicating that five groups of European countries are converging to distinct steady states for the aggregate CO2 emissions. We also find evidence of convergence clubs for industry sectors while manufacturing sector shows clubs convergence only when we use the first criterion while in the second case, we find only a single steady state. (C) 2021 Elsevier Ltd. All rights reserved.