Does the level of renewable energy matter in the effect of economic growth on environmental pollution? New evidence from PSTR analysis

This study investigates the relationship between environmental pollution and economic growth in the context of renewable energy in OECD countries using the panel smooth transition regression (PSTR) model for 1995–2018. The study finds the value of the threshold variable, calculated as the share of renewable energy use in total energy consumption, to be 7.825%. In this context, economic growth affects the environment negatively and increases environmental pollution when the share of renewable energy use in energy consumption is below the threshold. When this share is above the threshold, it reduces environmental pollution by affecting the environment positively. In addition, the findings reveal a non-linear inverted U-shaped relationship between the environment and economic growth in the context of renewable energy, and the Environmental Kuznets Curve (EKC) hypothesis is valid. Therefore, the widespread use of renewable energy is a solution to reducing environmental pollution. Accordingly, it is very important for policymakers to both highlight and encourage renewable energy use. Furthermore, countries need to both invest in this area and focus on R&D to increase renewable energy production.

     

Effects of urbanization and nonrenewable energy on carbon emission in Africa

This study investigates the impact of urbanization and nonrenewable energy consumption on carbon emissions. The context of the analysis is 54 African Union countries from 1996 to 2019. For estimation, we use panel quantile regression (PQR) and fully modified ordinary least squares (FMOLS). Our regression results demonstrate that there is a positive correlation between urbanization and CO₂ emission. Further, our empirical results confirmed that nonrenewable energy consumption increases environmental pollution in African Union countries. The outcomes demonstrate the EKC hypothesis because at the initial stage of development, when economic growth increases, environmental pollution increases; after a threshold point, environmental pollution decreases as economic growth increases. It can find an inverted U-shaped relationship between economic growth and CO₂ emission. The findings also show that urbanization should be planned; otherwise, it can lead to environmental degradation in the long run. Africa continent takes strict action and builds a blueprint for efficient and effective energy production and consumption. The only solution to achieve green growth in Africa is to shift from fossil fuel energy supply to renewable energy supply.

     

An analysis between financial development,institutions, and the environment: a global view

Financial development is important for the growth of a country which indirectly affects the environment adversely through industrialization. However, in the presence of strong institutions, this adverse effect can be reduced. The main concern of the present study is to estimate the relation between CO₂ and financial development (FD) in the presence of economic institutions as an interactive term. A sample of 101 countries has been selected for econometric analysis for the period from 1995 to 2017. The cross-section dependence test statistics for dependency, CIPS and CADF for panel unit root test, Westerlund test to ascertain the long-run affiliations, and FMOLS to extract the long-run coefficients have been applied. Dumitrescu and Hurlin test is also employed to know about the causal nature of the panel series. The findings show that financial development has a positive relationship with CO₂. However, after inclusion of economic intuitions, the adverse impact of financial development on the environment is reduced. The study also confirms the presence of environmental Kuznets curve in the context of income and financial development. The findings imply that financial development can help to improve environment quality if it is accompanied with strong institutional framework such as assurance of property rights, government integrity, and liberalization in financial sector.

     

Do renewable energies contribute to enhancing environmental quality in Eastern Africa?

East Africa has enormous renewable energy potential, but only a small portion of it has been exploited, and little is known on its role in improving environmental quality. Thus, this study empirically examines the impact of renewable energy on the environment using ecological footprint (EF; positive indicator) and CO₂ emissions (negative indicator) as proxy indicators for environmental quality in a panel of ten East African countries from 1990 to 2015. These indicators were chosen due to their potential impact in the environment. The work used the pooled mean group (PMG) as the main panel estimator to determine the impact while controlling non-renewable energy consumption, GDP per capita, and foreign direct investment (FDI). PMG has been used as it forces the long-run coefficients to be equal across all panel groups. The findings show that in the long run, there is a significant negative relationship between CO₂ emissions and renewable energy consumption, as well as a significant positive relationship (with a low impact) between EF and renewable energy consumption, suggesting that renewable energy use enhances the area’s environmental quality. Also, results indicate that non-renewable energy use degrades environmental quality in both metrics, whereas GDP degrades environmental quality through CO₂ emissions and improves environmental quality through EF. This requires East African countries to focus a higher emphasis on accessible renewable energy sources to achieve quick and sustainable economic growth and minimize environmental effects. To accomplish this, strategic policies and legislation, as well as the promotion of green technology, are required.

     

The effects of economic growth and innovation on CO2 emissions in different regions

Economic growth and economic energy consumption have received greater attention due to its contribution to global CO₂ emissions in recent decades. The literature on CO₂ emissions and innovation for regional differences is very scanty as there is not enough study that considered different regions in a single analysis. We adopt a holistic approach by incorporating different regions so as to assess how innovation contributes to emission reduction. The study, therefore, examined the effects of innovation and economic growth on CO₂ emissions for 18 developed and developing countries over the period of 1990 to 2016. The study used panel technique capable of dealing with cross-section dependence effects: panel cross-sectional augmented Dickey-Fuller (CADF) unit root to determine the order of integration, Westerlund cointegration tests confirmed that the variables are co-integrated. We employed panel fully modified ordinary least square (FMOLS) and panel dynamic ordinary least square (DOLS) to estimate the long-run relationship. The results show that energy consumption increases CO₂ emissions at all panel levels. However, innovation reduces CO₂ emissions in G6 while it increases emissions in the MENA and the BRICS countries. Environmental Kuznets curve (EKC) hypothesis is valid for the BRICS. The pollution haven hypothesis (PHH) and pollution halo effect were confirmed at different panel levels. Based on the findings different policy recommendations are proposed.

     

Influencing factors of carbon emissions and their trends in China and India: a machine learning method

China and India are the largest coal consumers and the most populated countries in the world. With industrial and population growth, the need for energy has increased, which has inevitably led to an increase in carbon dioxide (CO₂) emissions because both countries depend on fossil fuel consumption. This paper investigates the impact of energy consumption, financial development (FD), gross domestic product (GDP), population, and renewable energy on CO₂ emissions. The study applies the long short-term memory (LSTM) method, a novel machine learning (ML) approach, to examine which influencing driver has the greatest and smallest impact on CO₂ emissions; correspondingly, this study builds a model for CO₂ emission reduction. Data collected between 1990 and 2014 were analyzed, and the results indicated that energy consumption had the greatest effect and renewable energy had the smallest impact on CO₂ emissions in both countries. Subsequently, we increased the renewable energy coefficient by one and decreased the energy consumption coefficient by one while keeping all other factors constant, and the results predicted with the LSTM model confirmed the significant reduction in CO₂ emissions. Finally, this study forecasted a CO₂ emission trend, with a slowdown predicted in China by 2022; however, CO₂ emission’s reduction is not possible in India until 2023. These results suggest that shifting from nonrenewable to renewable sources and lowering coal consumption can reduce CO₂ emissions without harming economic development.

     

The role of innovations and renewable energy consumption in reducing environmental degradation in OECD countries: an investigation for Innovation Claudia Curve

Rising economic growth in recent ages is the primary concern of most of the countries to enhance the living standard, but the ever-increasing production of economic activities consumes a lot of energy, which leads to a sharp increase in carbon dioxide emissions. Innovation may be a remedy that can help improve energy efficiency, obtain renewable energy, and promote economic growth, thereby protecting the quality of the environment. Therefore, this paper examines the role of innovation and renewable energy consumption in CO2 reduction in OECD countries from 2004 to 2019. By using the two-step system generalized of moment estimator, the results show that economic growth and innovation significantly increase carbon emissions, however the innovation Claudia Curve (ICC) is verified, and the environmental Kuznets curve does not exist. Foreign direct investment has a negative impact on carbon emissions, thus verifying the Pollution Hao hypothesis, whereas renewable energy also improves environmental quality, but the interaction between innovation and renewable energy consumption still increases carbon emissions. Financial development, industrialization, trade, and energy consumption have also been found to be harmful factors of environmental quality. Our findings have considerable policy implications for OECD countries on the improvement of innovation indicators and investment in renewable energy sources to rise environmental quality.

     

Comparative analysis of the growth impact of pollution and energy use in selected West African nations

We adopt the FMOLS and Granger causality technique to analyse the effect of energy use and carbon emissions on output growth in selected West African economies, which includes Nigeria, Gambia and Ghana, from 1970 to 2019. Findings confirm that energy use enhances growth in the three selected West African economies. But in terms of significance, energy consumption is significant in Nigeria and Gambia at a 1% level of significance while it is insignificant for the Gambia. CO₂ emission positively and significantly propels economic growth for the three selected West African economies. For Nigeria, causality evidence shows no direct influence among the variables. For Ghana, we find a bi-causal association between output growth and carbon emissions and a unidirectional causality from pollution to energy consumption. For Gambia, economic growth causes CO₂ emissions. We recommend that the West African government reinforce their stand on a sustainable growth path through energy conservation.

     

The nexus between remittances,natural resources,technological innovation,economic growth,and environmental sustainability in Pakistan

Globally, the issues about sustainable development are on the increase. Moreover, these issues are rising every day in Pakistan, as remittances are increasing, technology innovation is ambiguous, natural resources are degraded, and economic expansion might pose serious challenges to the environment. Thus, this research looks at how remittances, natural resources, technological innovation, and economic growth affect carbon dioxide (CO₂₎ emissions in Pakistan by controlling energy consumption and urbanization from 1990 to 2019. The Bayer and Hanck test of combined cointegration discloses a cointegration between remittances, natural resources, technological innovations, economic growth, and CO₂ emissions. Moreover, the autoregressive distributive lag model (ARDL) proposes a significant positive association between remittances and CO₂ emissions in the long run, indicating that the increase in remittances distresses the environmental performance of Pakistan. Our study confirms that natural resources decrease CO₂ emissions while technological advancement, economic progress, energy use, and urbanization increase CO₂ emissions. In addition, the results of robustness checks by employing fully modified ordinary least squares and dynamic ordinary least squares are parallel to the conclusions of ARDL estimations. Furthermore, the frequency causality test results show that remittances, natural resources, technological innovation, economic growth, energy use, and urbanization cause CO₂ emissions at different frequencies. Therefore, to achieve the sustainable development goals, appropriate policy repercussions can be developed toward advanced and environmentally sustainable sources of energy.

     

Economic complexity,ICT, biomass energy consumption,and environmental degradation: evidence from Iran

Economic complexity, biomass energy consumption, and information communication technology (ICT) have diverse impacts on energy consumption and carbon dioxide (CO₂) emissions. Nevertheless, analysis of these variable effects is not addressed in the previous literature; the antiqueness of this article is stuffing this gap. This study assessed the relationship between gross domestic product (GDP) per capita, biomass consumption, economic complexity index (ECI), ICT, and CO₂ emissions in Iran in 1994–2018. The autoregressive distributed lag (ARDL) model and the quantile regression (QR) econometric technique were used to investigate the factors affecting CO₂ emissions in the tails of the conditional distribution. The share of each influential factor was predicted through the variance decomposition analysis (VD) for the next 10 years. The empirical results showed a long-run relationship between the variables. So, the variables of biomass consumption, ECI, and ICT improve the quality of the environment in Iran by reducing CO₂ emissions, and the per capita GDP variable increases CO₂ emissions. Results suggest no evidence indicating the presence of environmental Kuznets curve (EKC); however, QR demonstrated the existence of EKCs in the lower quantiles of the conditional distribution. The ECI will have the most share to change the CO₂ emissions in the future. The income threshold should be determined at the turning point of the EKC to increase economic development. Moreover, investing in increasing biomass consumption is vital. Policymakers also need to consider strict added value for the export of products.

     

Nexus among electricity consumption,foreign direct investment and aggregate economic activity towards Nigeria’s economic performance: evidence from a trivariate causality model

It is evident that there is nexus among electricity consumption, foreign direct investment and aggregate economic activity. Unfortunately, the causal relationship among the three variables in Nigeria based on modern econometric methods, recent time-series data and ways that sufficiently cater for inflation and population growth has not been adequately investigated. This study, among other things, used a trivariate vector error correction model, autoregressive distributed lag bounds test for cointegration and Granger causality test to analyse the causal relationship among electricity consumption, foreign direct investment and aggregate economic activity based on time-series data from 1970 to 2018. The study found the presence of neutral causality between electricity consumption and aggregate economic activity in the short run as well as unidirectional causality from aggregate economic activity to electricity consumption in the long run. The study also found the presence of unidirectional causality from foreign direct investment to electricity consumption as well as neutral causality between foreign direct investment and aggregate economic activity in both the short run and the long run. It is therefore recommended that steps should be taken to adequately increase foreign direct investment and aggregate economic activity in ways that will guarantee an optimal increase in electricity consumption in Nigeria.

     

A new perspective to environmental degradation: the linkages between higher education and CO2 emissions

Although there have been many studies, focusing on basic determinants of carbon dioxide emissions (CO₂), the effect of higher education, which has the potential to be an important determinant of CO₂, has been neglected. The paper aims to display the potential mechanisms between higher education and CO₂ and expand the environmental economics literature. In the paper, the trade-off between higher education and CO₂ is tested by autoregressive distributed lag (ARDL) during the period 1983–2017 in Turkey. Results denote that cointegration exists and an increase in higher education negatively affects CO₂. We also find that economic growth and energy consumption positively affect CO₂ both in the long run and short run. Vector error correction model (VECM) reveals that higher education, economic growth, energy consumption, trade openness, and exchange rates are the causes of CO₂ in the long run. Also, energy consumption and economic growth are the causes of CO₂ in the short run. Therefore, higher education can be used to overcome environmental problems.

     

Does tradeoff between financial and social indicators matters in environmental consideration: evidence from G7 region

The study tries to discover the impact of financial and social indicators’ growth towards environmental considerations to understand the drivers of economic growth and carbon dioxide emissions change in G7 countries. The DEA-like composite index has been used to examine the tradeoff between financial and social indicator matters in environmental consideration by using a multi-objective goal programming approach. The data from 2008 to 2018 is collected from G-7 countries. The results from the DEA-like composite index reveals that there is a mixed condition of environmental sustainability in G-7 countries where the USA is performing better and Japan is performing worse among the set of other countries. The further result shows that the energy and fiscal indicators help to decrease the dangerous gas emissions. Divergent to that, the human and financial index positively contributes to greenhouse gas emissions. Fostering sustainable development is essential to successfully reduce emissions, meet established objectives, and ensure steady development. The study provides valuable information for policymakers.

     

Biofuel consumption,biodiversity, and the environmental Kuznets curve: trivariate analysis in a panel of biofuel consuming countries

This study examined the relationship between biofuel consumption, forest biodiversity, and a set of national scale indicators of per capita income, foreign direct investment (FDI) inflows, trade openness, and population density with a panel data of 12 biofuels consuming countries for a period of 2000 to 2013. The study used Global Environmental Facility (GEF) biodiversity benefits index and forest biodiversity index in an environmental Kuznets curve (EKC) framework. The results confirmed an inverted U-shaped relationship between GEF biodiversity index and per capita income, while there is flat/no relationship between carbon emissions and economic growth, and between forest biodiversity and economic growth models. FDI inflows and trade openness both reduce carbon emissions while population density and biofuel consumption increase carbon emissions and decrease GEF biodiversity index. Trade openness supports to increases GEF biodiversity index while it decreases forest biodiversity index and biofuel consumption in a region.

     

Roadmap for climate alliance economies to vision 2030: retrospect and lessons

The United Nations Climate Conference 25, held in December 2019, reached a significant agreement against implementing the Paris agreement come 2020. Bound by the contract, 189 countries who are party to the deal agreed to constrain worldwide temperature to ascend to 1.5° Celsius. To this end, the present study attempts to investigate the readiness of selected countries in the European Union to implement the agreement, which will better the quality of the global environment. In line with this, this study appraises the connection between economic growth, renewable and non-renewable energy consumption, on emissions in 11 countries in the European Union from 1990 to 2016. The study utilises the Pooled Mean Group-Auto Regressive Distributed Lag (PMG-ARDL) model estimator and Dumitrescu and Hurlin Panel Causality analysis to analyse the long-run and short-run impact and direction of causality among these factors, respectively. The long-run study's empirical results show a U-shaped Environmental Kuznets Curve (EKC) and a negative connection between renewable energy use and emissions in the EU-11 countries. In the short-run, non-renewable energy use worsens CO₂ emissions while renewable energy use leads to a fall in emissions. Similarly, causality tests show a feedback mechanism between emissions and renewable energy use and between non-renewable energy and renewable use. Also, there is unidirectional causality from income to CO₂ emissions, non-renewable energy use to CO₂ emissions. The investigation recommends an expanded proportion of renewable energy sources in the EU countries’ energy mix to cut down on emissions.

     

Policy insight from renewable energy,foreign direct investment (FDI), and urbanization towards climate goal: insight from Indonesia

This study is premised on Indonesia’s climate goal amidst good economic performance. To test the environmental implication of this macroeconomic performance of Indonesia, we adopt Indonesian quarterly data of 1990Q1–2018Q4 for empirical analysis. Relevant instruments in the economic performance of Indonesia such as urbanization, foreign direct investment (FDI), and renewable energy source are all adopted for accurate estimations and analysis of this topic. Different approaches (structural break test, autoregressive distributed lag (ARDL)-bounds testing and Granger causality) are all adopted in this study. Our analysis and policy recommendations are based on the short-run and long-run ARDL dynamics and Granger causality. Findings from ARDL confirmed negative relationship between carbon emission and renewable energy source, FDI, and urbanization. Also, a U-shape instead of inverted U-shaped EKC is found confirming the impeding implication of Indonesian economic growth to its environmental performance if not checkmate. From Granger causality analysis, all the variables are seen transmitting to urbanization in a one-way causal relationship. Also, FDI and renewable energy prove to be essential determinants of the country’s environment development; hence, FDI is seen transmitting to both energy sources (fossil fuels and renewables) in a one-way causal relationship. Renewable energy is as well seen having two ways causal relationship with both carbon emission and fossil fuels. This result has equally exposed the significant position of the three instruments (urbanization, FDI, and renewable energy source) in Indonesian environment development.

     

Industrialization,urbanization, and carbon emission efficiency of Yangtze River Economic Belt—empirical analysis based on stochastic frontier model

Carbon emission efficiency directly determines the level of green economic development. Based on the panel data of China’s Yangtze River Economic Belt (YEB) from 2008 to 2017, this paper uses the stochastic frontier analysis (SFA) model to analyze the overall carbon emission efficiency level, influencing factors, and changing trends, with a view to discussing the relationship between economic development and carbon emission efficiency. The results suggest, first, the overall carbon emission efficiency of the YEB is on an upward trend, but there is still much room for improvement. Second, the impact of industrialization and urbanization on carbon emission efficiency follows a U-shaped. As industrialization and urbanization progress, the impact on carbon emission efficiency shows a downward and then upward trend. Third, due to the rebound effect, technological progress has a slight negative impact on carbon emission efficiency. Energy consumption structure, government intervention, and foreign trade are all negative incentive factors. Therefore, efforts to improve carbon emission efficiency in the YEB should focus on transforming the economic growth model, adjusting the industrial structure, improving the energy consumption structure, and innovating green technology. The research results can provide a reference for the government policymakers to develop a green economy.

     

Environmental quality vs economic growth in a developing economy: complements or conflicts

An increase in economic activities which leads to economic growth has been adduced as a possible factor for environmental degradation. While some other studies have argued that as economies keep growing, there are possibilities for resource redistribution which could engender environmental balance, thus engendering the argument on the conflicting-complementary position of the environment-growth nexus. In the light of this, this study uses previous activities between economic activities and the environment to determine the conflicting or complementary relationship that exists between economic growth and the environment. Also, using Nigeria as a case study, the design of environmental growth nexus to achieving sustainable development is assessed. Annual time series data between 1970 and 2014 were sourced from the World Development Indicators. Following the neoclassical perspective on ecological growth and the Kuznets inverted U-hypothesis on the environment-growth relations, stationarity test was performed, and the autoregressive distributed lag estimates were employed. From the study, it is seen that factors like rainfall that promotes environmental quality in the long run promote economic growth (per capita and GDP growth) in Nigeria. Similarly, factors like natural resource utilization, which depletes environmental quality, increases economic growth but reduces economic growth per capita; thus, with questions for development, the possibility of a complementary relationship for environmental quality and economic growth is spotted if the right policies are ensured. Also, the study found evidence of a growing conflicting relation between environmental quality (CO₂) and economic growth (per capita and GDP growth). Meanwhile, these conflicts to a great extent find expression in the Kuznets hypothesis; such that, if policies that promote income per capita reduces pollution and pursues eco-efficiency via economic growth are properly harnessed, there are the prospects of meeting up with the goals of environmental sustainability in developing economies.

     

Current and future perspectives on energy use and environmental impact

Energy consumption throughout the world contributes to pollution, environmental deterioration, and greenhouse gas emissions. Increases in energy consumption are usually driven by population growth and economic development that tends to increase energy use per capita. Thus, the projected increase in population in the near future, and the economic development that is likely in many countries, have serious implications for the environment. Since the early 1980s the relationship between energy use and environmental impact has received attention, and a number of activities have focused on this topic. In this paper, four important areas related to current and future patterns of environmental impact are introduced and discussed in detail: environmental impact, energy consumption, energy efficiency and conservation, and fuel substitution. We conclude that further political, economic and institutional changes from the standpoint of environmental impact appear to be necessary for future energy policies. To this end, energy efficiency improvements and renewable energy resources can play important roles in controlling and reducing environmental impact.     

How to bend down the environmental Kuznets curve: the significance of biomass energy

Sources of renewable energy have received wide attention in the literature because of serious threats to the environment. However, some renewable resources, including biomass energy role is debatable in the energy economics literature. This empirical work focuses to analyze the role of biomass energy in carbon dioxide (CO₂) emissions using the framework of the environmental Kuznets curve (EKC) in Pakistan over the period from 1980 to 2015. The bound testing approach suggests there is cointegration among study variables. The study uses an auto-regressive distributed lag model (ARDL) with a structural break in the series. To summarize the findings of the study, it can be inferred that biomass energy increase CO₂ emissions. In addition, biomass energy helps to form a U-shaped relationship between income and CO₂ emissions that support the EKC hypothesis. Also, the feedback hypothesis is found between biomass energy and CO₂ emissions. The findings would guide policymaker with practical guidelines to formulate policies to utilize a high amount of biomass energy in a sustainable manner.