The puzzle of greenhouse gas footprints of oil abundance.

The present inquiry lays a groundwork for the analysis of the net greenhouse gas (GHG) footprint of oil in the oil-abundant settings. To address the research question, the study puts forward a three-sector decision model, which provides a common ground for the assessment of the interaction of the structuralist and institutional factors influencing environmental pollution in the oil-reliant economies. The study shows that fossil-fuel abundance triggers forces, which induce diametrically opposed effects concerning atmospheric pollution. These are the rising carbon-intensive oil extraction and processing and fossil-fueled power generation versus shrinkage of the carbon-intensive manufacturing and growth of the low-carbon tertiarization. The theoretical analysis enables compartmentalization of the essential factors, which determine GHG emissions in the respective countries. To assess the significance of the proposed theoretical framework, the study employs multivariate panel co-integration techniques and two-stage fixed effects estimations for a dataset of 38 oil-producing countries for the time period between 1960 and 2018. In contrast to the existing literature, this study drives apart from the black box approaches that employ just one omnibus variable, per capita income. • The study combines two strands of literature – the Resource Curse and the environmental Kuznets curve hypotheses • A novel three-sector model, which provides a common ground for structuralist, institutional and purely economic analyses of carbon footprint, is put forward. • The inquiry disentangles the environmentally relevant forces triggered by oil abundance on the theoretical level. • Compartmentalization of the factors, induced by fossil fuel abundance and their empirical analysis, provides a basis for environmental policies in oil-producing countries. • The 'black box' parametric estimators establish a monotonically increasing relationship between oil rents and the quantity of greenhouse gas emissions. [ABSTRACT FROM AUTHOR]