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Transportation sector is considered a major contributor to the release of the carbon emissions in the atmosphere. The present research explores the effect of traffic, environmental taxes and expenditures on transport-related carbon emissions. We apply a cross-sectional autoregressive distributed lags estimator for short- and long-run estimates by using panel data for 35 OECD countries. We demonstrate traffic increase transport-related carbon emissions by 14.65% on average. Transport-related carbon emissions will rise by 1.5% over the near term as a result of the combined effect rail and road-vehicles, and energy consumption. Environmental expenditures and green transportation, on the other hand, will cut transportation emissions by 21.7% and 45.20% in the short and long runs, respectively. Furthermore, the findings reveal an inverted u-shaped link between transportation-related carbon emissions and consumption. Based on real-world evidence, this study advises that some countries reduce traffic while simultaneously increasing spending on the development of environmentally friendly transportation options.

Investigating the role of green transport, environmental taxes and expenditures in mitigating the transport CO2 emissions