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Abstract

The objective of this paper is to investigate the relationship between the fleet of flex-fuels vehicles and CO2 emissions in Brazil. We analyzed the robustness of parametric and semiparametric analyses using a panel data set at the state level from 1998 to 2013. In both analyses, we find that there is a strong negative correlation between CO2 emissions and flex-fuels vehicles. Moreover, our results also suggest that there are: 1) there is evidence of an Environment Kuznets Curve for flex-fuel vehicles; 2) a negative relationship between sugar cane cropped area (due to carbon sequestration) and CO2 emissions and; 3) a positive relationship between livestock and CO2 emissions.

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