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Since the European Union (EU)'s current goal of making its continent the world's first climate-neutral continent by 2050, the EU will need to set a path for new policies in the areas of Europe's economy, energy consumption, and agriculture. Thus, this paper analyzes the marginal impact of energy price and economic freedom on Europe's CO2 emissions grounded on the extended Stochastic Impacts by Regression on Population, Affluence and Technology ecology (STIRPAT) model together with the spatial econometric models. The results indicate the existence of spatial spillover effect of CO2 emissions among some countries in Europe. The Hausman test was also performed to select the best model between the random effects and the fixed effects. The findings suggest that increasing both economic freedom and energy price in a local country turns to reduce the country's own CO2 emissions and also reduces the emissions of its adjacent countries. Comparing the direct effect of economic freedom and energy price to that of the SDM fixed effect, a feedback of 12.77% and 23.53% of the direct effect was observed, respectively. The results also indicated that the turning point of economic freedom and economic growth was 6.714 and thus 9.083. Overall, the study spotlighted some policy suggestions for the energy market for the European commission in reducing the emissions of CO2. [ABSTRACT FROM AUTHOR]

The vision of every country or subregions is to achieve economic growth and sustainable economic growth. Thus, the Economic Community of West African States (ECOWAS) as an economic cooperation renders interaction among 16 relevant countries to increase economic development. However, CO2 emissions as a result of economic growth are of great concern. Thus, this study delves into the determinants of CO2 emissions along the ECOWAS community, taking into consideration if countries are energy exporters or energy importers. The analytical procedure applied indicated the presence of heterogeneity in the slope coefficient and cross-sectional dependencies across the various panels. Applying the Westerlund bootstrap co-integration unveiled, the employed variables have a long-run equilibrium association. The results from the augmented mean group (AMG) revealed that the contribution weight (order of importance) to CO2 emissions varies across panel clusters. Finally, the causality results unveil a bidirectional causation in all panels between urbanization and CO2 emissions, whereas foreign direct investment and CO2 emissions have a bidirectional effect in energy importers and the main panel. These results obtained indicate that foreign direct investment, urbanization, energy consumption, trade openness, and gross domestic product are the determinants of CO2 emissions along the community. Based on the outcome, the suggested policy implications indicate that (a) the need for a paradigm shift from fossil fuel sources to renewables be encouraged in the community and (b) again, the awareness of spillover of economic growth and energy transition on CO2 emissions from foreign companies to local businesses must be promoted. [ABSTRACT FROM AUTHOR]