Social capital, economic development and carbon emissions: Empirical evidence from counties in Sweden

Several studies have found empirical evidence for the role of social capital in environmental management where a high level of social capital reduces emissions of pollutants, and other studies point out a negative relation between income and environmental performance. Therefore, this paper examines if and how social capital explains Swedish county-level per capita CO2 emissions together with income in the period 2000-2017. A social capital composite index is constructed and different specifications of impacts on CO2 emissions of social capital and income and functional forms, linear and non-linear, are tested. The system generalized method of moments (GMM) is used to account for endogeneity in the presence of dynamic and spatial effects. Robust results are negative and significant effects of social capital on emissions, and positive effects of income. Other common results observed are significant dynamic and spatial carbon emissions effects.