This article examines what role natural factors play in explaining cross-co
untry differences in carbon dioxide emissions. Natural factors mean here di
fferences in the climatic conditions. the availability of renewable and fos
sil fuel resources and the transportation requirements of countries. While
income remains the main variable. regression results shock that natural fac
tors contribute significantly to an explanation of cross-country difference
s in carbon dioxide emissions. Furthermore. drastic differences in natural
conditions can lead to substantial differences in predicted emission requir
ements for individual countries at approximately the same level of income.
(C) 2001 Elsevier Science Ltd. All rights reserved.