Convergence of sectoral CO₂ emissions across Australian states and territories

We examine convergence in sectoral CO₂ emissions across Australian states and territories. We apply the Phillips-Sul club convergence methodology to investigate club convergence for nine sectors across eight Australian regions over the period 1990–2017. Our results indicate multiple convergence clubs for the total of all sectors and the eight sectors under investigation. However, we find no evidence of full club convergence in any one sector highlighting that Australian states and territories converge to multiple equilibria depending on the sector under investigation. These results lend support to the need for tailored policies unique to a particular cluster of regions that will target the reduction of CO₂ emissions in specific sectors.