Τhe current paper examines the relationship between per capita health care expenditures, per capita CO₂ emissions, and per capita gross domestic product (GDP) in G7 countries. At the beginning, we examine the cross-sectional dependence and the slope homogeneity between the countries. Then, the second-generation unit root test is applied using the Pesaran, CIPS (2007) test, while for the cointegration test, the Westerlund (Oxford Bulletin of Economics and Statistics 69(6):709-748, 2007) test was applied. The long -run panel cointegration coefficients were analyzed with the augmented mean group (AMG) estimators, which allow the cross-sectional dependence and heterogeneity. Finally, the test by Dumitrescu and Hurlin (Economic Modelling 29(4):1450-1460, 2012) was used in order to check for causality taking into account the heterogeneity and cross-sectional dependence on panel data. The preliminary analyses show that variables are cross-sectional-dependant and heterogenous and are first-order stationary. Cointegration test by Westerlund (Oxford Bulletin of Economics and Statistics 69(6):709-748, 2007) which allows heterogeneity and cross-sectional dependence show that there is a stable and long-run relationship between variables. Moreover, the long-run coefficients which were estimated with the AMG approach are found to be statistically significant and positive for the GDP per capita, and negative in the case of greenhouse gas emissions per capita. Finally, causality test by Dumitrescu and Hurlin (Economic Modelling 29(4):1450-1460, 2012) revealed a unilateral causality from greenhouse gas emissions per capita towards health expenditure per capita for all G7 countries.

In academic discussions about how to achieve sustainable growth in the world, it is stated that this is not possible without spending on research and development and innovative activities so that countries can maintain their competitiveness in the global environment. The EU has defined strategies that consider innovation as a key element for stimulating growth and creatung employment. In this context, this study examines the relationship between R&D expenditures and the global innovation index in the scope of EU countries. A PVAR model and annual data from 2007 to 2020 were used for the relationship between research expenditures and growth in the innovation of EU countries. We first examined the cross-sectional and cross-country homogeneity of slopes. The second-generation unit root test was then applied using the Pesaran CIPS (2007) test, and the ARDL panel model was applied to test for cointegration. Causal analyses with the panel ARDL model and the error correction model were applied to determine the relationships of the variables and their direction. For the long-term dynamic effects between variables, an impulse response function (IRF) was used, and for the degree of the effect between R&D expenditures and the global innovation index, variance decomposition was used. The results of this paper reveal a long-term positive significant relationship between R&D spending and the global innovation index, whereas in the short-term, this relationship is negative. Furthermore, the causality results of the error correction ARDL model show unidirectional short-run and long-run causality from research and development to the global innovation index in EU countries. Finally, this paper enhances the understanding of the relationship between research and development spending and the global innovation index in EU countries.

Forecasting European Union CO2 Emissions Using Autoregressive Integrated Moving Average-autoregressive Conditional Heteroscedasticity Models

This article aims to investigate the relationship between real money, real Gross Domestic Product (GDP) and the nominal short-term rate of interest in the two new European Union (EU) member states. In pursuit of this objective, the tests of panel cointegration and Fully Modified Ordinary Least Squares (FMOLS) are conducted by using panel data. The data used in this study consist of annual data during period 1990 to 2008. The panel cointegration results confirm a long-run relationship between real money, real GDP and the nominal short-term rate of interest. Our empirical results also show that real GDP elasticity is 0.739 and nominal short-term rate of interest elasticity is −0.013 for the panel of the two countries.