The nexus between financial development, income level, and environment in Central and Eastern European Countries: a perspective on Belt and Road Initiative

Impacts of renewable and disaggregated non-renewable energy consumption on CO2 emissions in GCC countries: A STIRPAT model analysis

This research investigates the effects of renewable (REC) and disaggregated non-renewable energy consumption (coal, oil, and natural gas) on CO2 emissions (CO2) in GCC countries, employing the STIRPAT model. The research also compares the impact of various non-renewable energy (NREC) sources to identify their contributions to CO2 emissions. Demographic factors like population and economic growth are considered main determinants of CO2. Panel data econometric methods are used, including diagnostic tests and unit root tests, to found long-run relationships among the variables. The study reveals significant positive associations between coal, natural gas, oil consumption and CO2, with oil having the highest impact. Conversely, REC shows a significant negative correlation with CO2. Economic growth and population are also linked to increased CO2. The findings emphasize the need for strategies promoting renewable energy usage, energy efficiency, public transportation, carbon pricing, and research in green technologies to alleviate CO2 and enhance sustainable development in the GCC countries.

The non-linear relationship between globalization, financial development and energy consumption: Evidence from BRICS economies

In the era of globalization, financial development plays a key role in socioeconomic and environmental development. However, its adverse consequences on human life, environmental hazards, and high energy consumption cannot be ignored. Thus, this study investigates the non-linear relationship between globalization, financial development, and energy consumption for BRICS economies. In doing so, we have applied second-generation tests to identify cross-sectional dependence in the data. Cross-sectional augmented Dickey-Fuller (CADF) and Cross-sectional Im-Pesaran Shin (CIPS) have been performed to find the stationary level of variables. The long-term equilibrium link between the investigated variables has been established in continuance using the Westerlund Cointegration test. The Dynamic Seemingly Unrelated Regression (DSUR) indicates that U-shaped relationships exist for financial development and globalization with energy consumption. Conversely, there is an inverted U-shaped relationship exist between economic growth and energy consumption in BRICS. The Dumitrescu-Hurlin panel causality test findings show that a unidirectional link runs from energy consumption to financial development, economic growth to energy consumption, and globalization towards energy usage. Important policy implications have also been discussed.

Pollution, political instabilities and electricity price in the cee countries during the war time

Pollution, war and energy crisis are the CEE countries' most important global actual issues. Therefore, this study aims to investigate the impact of political stability and electricity price in 11 CEE countries in the period 2007-2021 to anticipate the effect of these factors on pollution in times of political and energy crisis. The common results based on DOLS/FMOLS and CCEMG estimations indicate that political stability enhances CO2 emissions, while higher electricity prices for non-household consumers reduce pollution. An inverted-U pattern was observed in the relationship between growth and pollution, while renewable energy consumption is the most powerful tool to reduce CO2 emissions. These results are the starting point for policy recommendations.

Environmental impact of globalization: The case of central and Eastern European emerging economies

Against the backdrop of piling environmental concerns in the modern era of globalization, this study aims to check the validity of the Pollution Haven Hypothesis (PHH) in Eastern European emerging countries and the relevance of globalization. The study targets to reduce the lack of consensus on the globalization-economic complexity-environment in European countries. Besides, we also intend to explore the existence of an N-shaped economic complexity-related Environmental Kuznets Curve (EKC) controlling for the bearing of renewable energy on environmental degradation. For analytical purposes, both parametric and non-parametric quantile regression approaches are employed. Overall, we find a non-linear relationship between economic complexity and carbon emissions, and N-shaped EKC is verified. Globalization and renewable energy consumption boost and inhibit emissions, respectively. More importantly, the results confirm the moderating role of economic complexity in neutralizing the carbon emissions-boosting effect of globalization. On the other hand, the non-parametric findings show that the N-shaped EKC hypothesis does not hold for high emissions quantiles. Furthermore, for all emissions quantiles, it is found that globalization boosts emissions, economic complexity, and globalization jointly curbs emissions and renewable energy curbs emissions. Based on the overall findings, some vital environmental development policies are recommended. The conclusions support shaping policy options promoting economic complexity and renewable energy as key factors in mitigating carbon emissions.

The role of economic production, energy consumption, and trade openness in urbanization-environment nexus: a heterogeneous analysis on developing economies along the Belt and Road route

In today's world, where urbanization is at its pinnacle, has created a significant economic gap between rural and urban populations in developing economies and substantially influenced environmental degradation. This study investigates the relationship between urbanization and environmental degradation via carbon emissions among developing countries along the Belt and Road route from 1990 to 2019 while using economic production, energy consumption, and trade openness as control variables. The study engages current econometric methodologies to uncover accurate and reliable findings, and the outcomes reveal that the panel under investigation is cross-sectionally dependent and heterogeneous. Therefore, the AMG, CCEMG, and DCCEMG estimators are employed to examine the effect connection between the variables. The outcomes unveil that urbanization, economic production, and energy consumption escalate environmental degradation, but trade openness is confirmed as a trivial determinant of environmental degradation. Furthermore, the causal connections between the variables disclose bi-directional causalities between urbanization and environmental degradation and between energy consumption and environmental degradation. Nevertheless, uni-directional causalities are affirmed, spanning from economic production to environmental degradation and from trade openness to environmental degradation. Finally, policy implications are discussed.

Investigating global surface temperature from the perspectives of environmental, demographic, and economic indicators: current status and future temperature trend

Anthropogenic activities have increased atmospheric concentrations of greenhouse gas emissions, which have observably increased global temperature. Recognizing it as one of the most critical issues caused by human activities, this study investigates the effects of environmental, demographic, and economic indicators on global and regional temperature. For this purpose, advanced and powerful machine learning techniques, such as ANN, CNN, SVM, and LSTM, are employed using the data from 1980 to 2018 of the aforementioned regions to predict and forecast global and regional temperatures in Africa, Asia, Europe, North America, and South America. First, the predicted results were found very close to the actual surface temperature, confirming that environmental, economic, and demographic indicators are critical drivers of climate change. Second, this study forecasted global temperature from 2023 to 2050 and regional temperature from 2022 to 2050. The results also predicted a considerable increase in global temperature and regional temperature in the forthcoming years. Particularly, Asia and Africa may experience extreme weather in the future with an increase of more than 1.6 °C. Based on the findings of this study, the major implications have been that maintaining greenhouse gas emissions, balancing economic development, urbanization, and environmental quality while reducing fossil fuel energy consumption will ensure climate mitigation. The findings demand an alteration in human behavior regarding fossil fuel energy consumption to control greenhouse gas emissions, which is the most significant contributor to climate change.

Examining key impact factors of energy-related carbon emissions in 66 Belt and Road Initiative countries

Climate change with global warming as the main feature associated with fossil energy use has been recognized as a threat to public health and welfare. Energy-related carbon emission reduction is a more serious challenge for BRI (Belt and Road Initiative) countries with rapid economic development. Examining key impact factors is necessary and helpful. This paper is the first study providing detailed country-by-country analyses aiming to identify the key drivers and inhibitors of energy-related carbon emission in 66 BRI countries with more systematic impact factors. The results show that: (1) Economic development (A), population (Ps), urbanization (Pu), and industrialization (Ss) are the key drivers for 52%, 26%, 11%, and 6% countries of BRI countries. Technological progress (T), energy consumption structure (E), and tertiary industry proportion (St) serve as key inhibitors for 65%, 17%, and 8% countries of BRI countries. (2) Different carbon emission reduction strategies should be formed on different geographical scales. At the international level, carbon emission reduction consensus should be reached and carbon emission reduction targets should be formulated. At the regional level of the Belt and Road Initiative, a carbon emission reduction cooperation fund should be established, and carbon emission reduction technologies and measures should be exchanged and data should be shared to promote the green development of the Belt and Road. At the national level, there should be carbon emission reduction policies reflecting national characteristics. At the local level, there should be specific carbon reduction measures in line with local conditions.

Dissipating environmental pollution in the BRICS economies: do urbanization, globalization, energy innovation, and financial development matter?

The question of how Brazil, Russia, India, China, and South Africa (BRICS countries) can substantially dissipate environmental pollution (EVP) remains unsolved. In this regard, this research explores the dynamic association between energy consumption (EGC), economic expansion (EXP), globalization (GLO), energy innovation (ENI), urbanization (URB), financial development (FID), and environmental pollution (EVP) using panel data from 1990 to 2020. This study integrated the augmented mean group (AMG), common correlated effect means group estimator (CC-MG), and fully modified ordinary least square (FMOLS) model approach to estimate the long-run interaction among the series. The findings of this study reveal a positive and significant association between economic expansion, energy consumption, urbanization, financial development, and environmental pollution. In contrast, globalization and energy innovation extensively abate EVP in the BRICS economies. Moreover, the outcome of the Granger causality test indicates that energy consumption and energy innovation have a bidirectional association with EVP. The Granger causality test further revealed a unidirectional causality between globalization, urbanization, financial development, and environmental pollution. Finally, this research has implications for policymakers in the BRICS countries.

The Non-Linear Impact of Financial Development on Environmental Quality and Sustainability: Evidence from G7 Countries

This paper analyses the impact of financial development on the environmental quality and sustainability for the group of G7 countries over the period 1990-2019 based on static panel data-fixed effect models. The objective is to explore if there exists a non-linear relationship between the whole financial system development and a wide array of measures of environmental sustainability and degradation, namely adjusted net savings, greenhouse gas, CO2, methane, nitrous oxide emissions and ecological footprint. We define a new Financial Environmental Kuznets Curve (FEKC) by introducing the square term of financial development on the environment-finance relationship. Empirical results prove the existence of non-linear relationships between the composite index of financial development and environmental degradation for the group of advanced economies. In the case of methane, we validate the presence of an inverted-U shape association in line with the FEKC hypothesis, while for greenhouse gas and CO2 the link follows a U-shaped pattern. The impact of financial development on environmental sustainability is monotonically positive and statistically significant while the ecological footprint is not statistically linked with the level of financial development within G7 countries. Economic growth, human capital, population density and primary energy consumption appear as significant drivers of environmental quality and sustainability.

Do Income Inequality and Institutional Quality affect CO2 Emissions in Developing Economies?

Concerns about income inequality and environmental pollution have stayed important aspects in reaching sustainable development objectives. However, economies continue to struggle with income inequality reduction and environmental degradation mitigation, all of which need significant consideration. Hence, the purpose of this research is to look into the relationship between income inequality, institutional quality, and carbon dioxide (CO₂) emissions in 42 developing countries from 1984 to 2016. Furthermore, the current study also investigates the role of institutional quality in moderating the relationship between income inequality and CO₂ emissions. For empirical analysis, we used cross section dependence, cross section unit root, and Westerlund's cointegration test to confirm the cross section dependence, stationarity, and cointegration among variables. Moreover, for long-run estimates, we employed Driscoll Kraay regression. According to the Driscoll Kraay regression outcomes, rising income inequality (without interaction term) leads to rising CO₂ emissions. However, (with interaction term) it shows a significant negative effect on CO₂ emissions. The findings of the interaction term (LnISQXLnINE) disclose a significant negative effect on CO₂. Moreover, an increase in institutional quality, economic development, energy consumption, industrialization, and trade openness significantly increase CO₂ emissions in all the models. In addition, the square term of income inequality and economic growth depicts an inverted U-shaped association with CO₂ emissions. The outcomes are also verified by the robustness check results acquired employing the fully modified ordinary least squares (FMOLS) and pooled mean group (PMG). Furthermore, Dumitrescu and Hurlin's panel causal test reveals a bidirectional causality running from income equality, energy consumption, industrialization, economic growth, trade, and interaction term toward CO₂ emissions. In view of the sustainable development goals (SDGs), the findings proposed significant policy repercussions for the study's sample economies.

Tracking Transfer of Carbon Dioxide Emissions to Countries along the Silk Roads Through Global Value Chains

The Belt and Road Initiative (BRI) has aroused rich discussions about the possible increase in carbon dioxide emission under the arduous global carbon dioxide emission reduction task. Adopting the methods of input-output technique and complex network analysis, we first construct a fairer method to trace carbon dioxide emission transfer based on global value chains, then trace the source of carbon dioxide emission transfer to the Silk Roads countries with a long-term multiple regional input-output database. We find that, first, after the proposal of the BRI, the total direct carbon dioxide emissions of the Silk Roads countries and China's proportion of carbon dioxide emission transfer to the other Silk Roads countries have both declined. Second, the Silk Roads countries are generally the net receivers of carbon dioxide emission transfer, and the inflow is mainly distributed in Southeast Asian countries and core countries in other sub-regions. Then, the transfer of carbon dioxide emission accepted by the Silk Roads countries comes mostly from large developing countries, such as China, Russia, and India, and developed countries, such as the United States, Japan, and Germany. The products are mainly concentrated in energy and chemical industries, as well as heavy industries, such as mining and quarrying, and metal products. We suggest that, due to the high degree of spatial and industrial concentrations of carbon dioxide emission transfer, it is necessary to make targeted policies for these countries and industries to reduce these transfers.

Pollution control in Africa: the interplay between financial integration and industrialization

We employ the pool mean group method of estimation and panel causality to investigate the effect of financial integration and industrial development on pollution in 36 African countries between 1990 and 2019. Result shows a unidirectional causality running from industrial development to financial integration and pollution in Africa. Also, the panel regression shows that financial integration insignificantly abates pollution in the short run, but significantly worsens the long-run pollution in the continent. Again, the result indicates that industrial development insignificantly heightens pollution in both periods, while interplay between financial integration and industrial development exerts a negative impact on both short- and long-run pollution in Africa. The study recommends that African leaders should harness the benefits of financial integration to accelerate African industrial development and ensure the full implementation of environmentally sustainable policies to checkmate pollution emissions.

Dynamic linkages of financial inclusion, modernization, and environmental sustainability in South Asia: a panel data analysis

This study explores the dynamic linkages of financial inclusion, modernization, and environmental sustainability in South Asia during the period 1998-2019. Two distinct composite indexes for financial inclusion and modernization are developed by using principal component analysis (PCA) based on normalized indicators. To examine the dynamic linkages, we adopted panel regression models that are not only robust but also heteroskedasticity consistent. We find that financial inclusion, modernization, per capita GDP, and FDI appear to lead to higher CO2 emissions in the South Asian region. Meanwhile, increased economic integration and trade openness appear to have negative dynamics for carbon emissions. These empirical findings are unbiased and robust to different reasonable modifications to panel data model specifications. This study comes up with the conclusion that presently there is no policy coherence and coordination between growing financial inclusion, modernization, and carbon mitigation strategies in South Asia. Thus, the prospect of financial inclusion and modernization should be cohesive into comprehensive climate change mitigation strategies at regional, national, and global levels, specifically to mitigate the adverse dynamics of higher carbon emissions associated with modern development.

Long-run equilibrium relationship between energy consumption and CO2 emissions: a dynamic heterogeneous analysis on North Africa

Environmental protection and sustainable development are inextricably linked. This linkage is particularly crucial for North Africa, where the use of carbon-intensive energies has created environmental and economic challenges. Amazingly, limited studies on the connection between energy consumption and environmental quality has been conducted to help with policy options to minimize the above menace in the region. Inspired by the Sustainable Development Goals (SDGs) of the United Nations, this study contributed to filling this gap by examining the energy consumption-CO2 emission nexus in North Africa for the period 1990 to 2018. In order to account for cross-sectional dependence, endogeneity, and slope heterogeneity that are mostly ignored by some conventional econometric techniques, this exploration adopted second generation econometric methods that are robust to the aforestated issues in its analysis. From the results, the studied panel was heterogeneous and cross-sectionally correlated. Also, the investigated series were first differenced stationary and cointegrated in the long-run. The cross-sectional augmented autoregressive distributed lag (CS-ARDL) and the dynamic common correlated effects mean group (DCCEMG) estimators were adopted to explore the elasticities of the explanatory variables and from the results, energy consumption worsened environmental quality in the region due to its positive influence on CO2 emissions. Also, urbanization and economic growth increased the rate of CO2 emissions in the countries. On the causal connections amid the series, bidirectional causalities between energy consumption and CO2 emissions, between urbanization and CO2 emission, between economic growth and CO2 emissions, and between urbanization and energy consumption were unraveled. Finally, unidirectional causalities from economic growth to energy consumption, and from economic growth to urbanization were confirmed. It is recommended that countries in North Africa should shift to the consumption of clean energies to help them attain low-carbon economy. Unavailability of data for some periods was the major limitation of the study. Therefore, in future when such data become available, similar explorations could be conducted to confirm the robustness of the study's results.

Financial development and environmental sustainability in West Africa: evidence from heterogeneous and cross-sectionally correlated models

Although West African nations are flourishing economically of late, they still have environmental issues due to the high rate of emissions in the bloc. Despite the worsening environmental condition, there have been limited studies on the causal agents of this situation in the region. Therefore, drawing strength from the United Nations' Sustainable Development Goals (SDGs) and their targeted impacts of 2030, this study explored the nexus between financial development and environmental sustainability in West Africa (WA) for the period 1990 to 2016. The cross-sectional autoregressive distributed lag (CS-ARDL) estimator alongside the cross-sectionally augmented distributed lag (CS-DL) and the cross-sectional augmented error correction (CAEC) estimators were engaged to examine the elastic effects of the explanatory variables on the explained variable and from the results, financial development was harmful to environmental sustainability in WA through high carbon emissions. Also, control variables foreign direct investments, energy consumption, industrialization, and population growth were detrimental to the sustainability of the environment. On the causal connections amid the series, a unidirectional causality from financial development and population growth to carbon emissions was uncovered. Also, feedback causalities between foreign direct investments and carbon emissions, between energy consumption and the effluents of carbon, and between industrialization and environmental pollution were unraveled. Based on the findings, the study recommended among others that the countries should integrate environmental welfare objectives into their financial development policies. Also, the nations should ensure that their citizens have access to energy that is affordable, reliable, sustainable, and modern (SDG 7). Finally, improvement in energy efficiency, sustainable infrastructure, and good use of resources (SDG 12) should be promoted by the nations. The above recommendations if seriously taken into consideration will help the region to combat climate change and its impacts, which is the focus of SDG 13. The main flaw of this exploration was the lack of data for some specific time periods. Therefore, in future when such data become available, similar investigations could be carried out to confirm the robustness of the study's results.

Role of financial development, environmental-related technologies, research and development, energy intensity, natural resource depletion, and temperature in sustainable environment in Canada

Environmental sustainability concerns are increasing worldwide; both developing and developed countries face environmental degradation. Literature has highlighted the environment-growth nexus; however, the impact of environmental-related technologies on the environment is ignored in early studies. This study aims to explore the implications of financial development, environmental-related technologies, research and development, energy intensity, renewable energy production, natural resource depletion, and temperature in a sustainable environment in Canada by using a time series model, i.e., dynamic ARDL simulations (Jordan and Philips 2018) with data from 1989 to 2020. The examined findings of the dynamic ARDL simulations indicate that environmental-related technologies in Canada help to reduce environmental degradation both in the short run and in the long run. At the same time, financial development, energy intensity, renewable energy production, research and development, natural resource depletion, and temperature causes boost the environmental degradation in Canada. To achieve sustainable environment, Canada needs to improve innovations in the environmental-related technologies for achieving sustainable growth and environment.

Linking financial development, economic growth, and ecological footprint: what is the role of technological innovation?

The literature analyzing the ecological impacts of financial development (FD) documents mixed results. In addition, very limited researches consider the role of technological innovation in ecological sustainability even though technological innovation is indispensable to achieve technological advancement, which may help in sustainable development and ecological sustainability. Therefore, this work probes the effects of technological innovation, financial development, and economic growth (GDP) on the ecological footprint (EF) controlling urbanization and employing a STIRPAT framework. The analysis of data from West Asia and Middle East nations from 1990 to 2017 revealed cointegration in the model. The long-run coefficients produced by the continuously updated fully modified technique revealed that a 1% upsurge in technological innovation decreases EF by 0.010%. Interestingly, technological innovation is helpful to decrease EF and enhance economic growth in the West Asia and Middle East (WAME) countries. However, a 1% rise in FD boosts the level of EF by 0.0016% inferring that FD stimulates ecological degradation. Likewise, urbanization in the WAME countries raises EF levels and contributes adversely to ecological quality. In addition to this, the study revealed the environmental Kuznets curve hypothesis in the selected countries accounting for technological innovation, FD, and urbanization in the model. The causal analysis provided evidence of unidirectional causality from FD to EF and bidirectional causality between technological innovation and EF. The study recommends more investment in research and development and strong collaboration between the universities and industries to promote the level of technological innovation for both sustainable development and ecological sustainability. In addition, urban sustainability policies are necessary without decreasing the urbanization level.

Modeling financial development, tourism, energy consumption, and environmental quality: Is there any discrepancy between developing and developed countries?

The main purpose of this study is to explore the dynamic association between financial development, tourism, primary and renewable energy utilization, urbanization, and carbon emission by employing the longitudinal data of 52 countries from 1995 to 2017. Empirical results of panel pooled mean group-autoregressive distributive lag (PMG-ARDL) model reveal that financial development significantly improves the environmental quality in developed countries. However, it has a detrimental but insignificant effect on the environment in developing countries. In the case of developed countries, the profound tourism sector is more harmful to the environment due to a large number of tourist arrivals in contrast to the developing countries. There is a wide difference between developed and developing countries concerning industrial, regional, and economic structure, in the effect of financial and tourism development on carbon emission, but both urbanization and primary energy utilization promote carbon emissions. The utilization of renewable energy sources improves the environmental quality in both regions. Generally, it is suggested that investment in renewable energy resources in both regions affects pollution differently and still has the potential to accelerate environmental quality. Moreover, the panel causality test explores that there exists bidirectional causality between financial development, primary energy, and carbon emission in both regions, while a unidirectional causality is observed from urbanization to carbon emission in developed countries. In developing countries, it exists from tourism to carbon emission and carbon emission to renewable energy. Finally, from policy perspectives, the results of this research recommend developing the financial system, and more funds should be allocated in modern and eco-friendly energy projects and utilized energy-efficient technologies.

Potential economic indicators and environmental quality in African economies: new insight from cross-sectional autoregressive distributed lag approach

Growing economic development and substantial demographic shifts may have a momentous consequence on environmental quality in a number of African countries. Consequently, this recent study offers the opportunity to explore the nexus among unobserved influential economic indicators and environmental quality (measured through CO₂ emissions) in a panel of 26 African economies spanning from 1990 to 2018. The aggregated panel is sub-classified into net exporters (NEC) and net importers (NIC) of embodied carbon. Considering existence of cross-section reliance and heterogeneity issues, all observed series are preliminarily confirmed stationary and cointegrated. Further, key outcomes from the common correlated effect Pooled Mean Group (CCEPMG) estimator through cross-sectional autoregressive distributed lag (CSARDL) approach showed that (i) economic growth and fossil fuel energy use stimulate environmental degradation among all panels, (ii) urbanization and trade openness enhance environmental quality in NEC panel while environmental damage is increased in NIC and aggregated panels, (iii) financial development also enhanced environmental quality in the totaled and NEC panel of African countries, but rather maturated climate deterioration in NIC panel, (iv) industrialization had a substantial adverse effect on environmental quality through surge in emission of CO₂ concerning the aggregated panel and NEC African states, and (v) overall the environmental Kuznets curve (EKC) conjuncture is validated among all panels. The findings were also affirmed by Augmented Mean Group (AMG) technique. Finally, Dumitrescu-Hurlin Granger causality checks showed strong causal affiliations heterogeneously across all panels. From the policy perspective, the analytical outcomes from this study summarily encourage the introduction of profitable policies that can facilitate green energy and economic structural change to diminish the degree of environmental degradation from emission of CO₂. Steps to strengthen a low-carbon and sustainable green environment should therefore collectively address these factors during policy growth.

Trade openness and CO2 emanations: a heterogeneous analysis on the developing eight (D8) countries

The focus of this exploration was to examine the linkage between trade openness and CO2 effusions in the developing eight (D8) countries. An unbalanced panel dataset spanning the period 1990 to 2016 was employed for the study's analysis. From the results, the studied panel was heterogeneous and cross-sectionally correlated. Also, all the series gained stationarity after first difference and were materially cointegrated in the long run. The elastic effects of the input variables on the output variable were explored through the DCCEMG estimator, with the support of the AMG and the CCEMG estimators. From the results, trade openness increased CO2 emanations in the D8. Also, economic growth, energy consumption, and financial development promoted CO2 secretions in the nations; however, foreign direct investments mitigated the excretion of CO2 in the countries. On the causal connections amid the series, there was a bidirectional causality between trade openness and CO2 emanations. Also, a one-way causal movement from energy consumption, foreign direct investments, and financial development to CO2 effluents was discovered. Based on the findings, it was recommended among others that effective trade policies that could enhance the transfer of cleaner technologies to the countries should be formulated.

Nexus between Financial Development, Renewable Energy Consumption, Technological Innovations and CO2 Emissions: The Case of India

Concerns regarding environmental sustainability have generally been an important element in achieving long-term development objectives. However, developing countries struggle to deal with these concerns, which all require specific treatment. As a result, this study explores the interaction between financial development, renewable energy consumption, technological innovations, and CO2 emissions in India from 1980 to 2019, taking into account the critical role of economic progress and urbanization. The Autoregressive Distributed Lag (ARDL) model is used to quantify long-run dynamics, while the Vector Error Correction Model is used to identify causal direction (VECM). According to the study’s conclusions, financial development has a considerable positive impact on CO2 emissions. The coefficient of renewable energy consumption and technical innovations, on the other hand, is strongly negative in both the short and long run, indicating that increasing these measures will reduce CO2 emissions. Furthermore, economic expansion and urbanization have a negative impact on environmental quality since they emit a significant amount of CO2 into the atmosphere. The results of the robustness checks were obtained using the Fully Modified Ordinary Least Squares (FMOLS), the Dynamic Ordinary Least Squares (DOLS), and the Canonical Cointegration Regression (CCR) approaches to verify the findings. The VECM results reveal that there is long-run causality in CO2 emissions, financial development, renewable energy utilization, and urbanization. A range of diagnostic tests were also used to confirm the validity and reliability. This study delivers new findings that contribute to the existing literature and may be of particular interest to the country’s policymakers in light of the financial system and its role in environmental issues.

Renewable energy, economic development, and ecological footprint nexus: fresh evidence of renewable energy environment Kuznets curve (RKC) from income groups

This study aims to measure the association of real economic growth per capita, renewable energy consumption, and financial development with ecological footprints (EFP) across the 155 countries of four different income groups over the period of 1990-2017. For the analysis, the unit root tests allowing cross-sectional dependency, Westerlund cointegration test, common correlated effect of mean group, augmented mean group, mean group, and Dumitrescu-Hurlin panel causality test are used. The results verify both the environmental Kuznets curve (EKC) and renewable energy environment Kuznets curve (RKC) hypotheses in the high-income group; however, other groups have not shown reliable results. Moreover, it is observed that the existence of RKC is a turning point for high-income countries, and it takes place before the turning point of the forthcoming EKC. Besides, empirical outcomes endorse the presence of long-run equilibrium and indicate that financial development has a negative and significant effect on the EFP in the case of the high-income group. In contrast, upper-middle- and lower-middle-income groups show the insignificant relationship with the dependent variable. Likewise, financial development has a positive and significant association with EFP for the low-income group. Conversely, biomass energy has a negative relationship with EFP in high- and lower-middle-income groups, while a positive association has been observed for the remaining two groups. We suppose that the study outcomes would guide the policymakers in decision-making regarding the development and usage of renewable energy to prevent environmental damages.

Towards Local Sustainability of Mega Infrastructure: Reviewing Research on the New Silk Road

The Belt and Road Initiative is the leading project in the regions along the ancient Silk Road. This aims to revive the New Silk Road (NSR) as a transnational space towards an era of new regional integration and globalization. Despite the potential economic effects on a global scale, local sustainability remains questionable. Building upon the central engagement in infrastructure improvements, this article aims to investigate the role of local sustainability in research along the New Silk Road. Starting with 597 scientific articles, this article conducts a systematic literature review on four levels of concretization to characterize the research field of the New Silk Road, and to develop in-depth insights systematically. The results reveal a research focus on economic growth, which is lacking in environmental considerations and especially the socio-cultural dimension of sustainability on a local scale. Future directions in local sustainability should therefore include local stakeholders to build a joint understanding of sustainability by recognizing the characteristics of regionalism upon which manifold local support of mega infrastructure can evolve. Given these findings, the New Silk Road emerges as a field of study that calls for interdisciplinary research on different spatial levels.

The influence of trade openness on environmental pollution in EU-18 countries

Trade openness is one of the main channels of globalization and technological transfers. In environmental economic literature, the implications of trade openness remain controversial and still could be potential drivers of carbon dioxide emissions. This study therefore explores the effect of trade openness in developed countries using EU-18 economies. We employed an econometric approach that accounts for cross-section dependence among study variables. The panel CIPS and CADF unit root show that the variables are stationary and the long-run relationship was confirmed in Westerlund cointegration tests. The mean group (MG) and augmented mean group (AMG) results show that trade openness increases CO₂-emissions in EU-18. Again, energy consumption and urbanization escalate emissions. The study confirmed the environmental Kuznets curve. Finally, pollution halo and pollution haven hypothesis were confirmed at both estimation methods. The Dumetriscu-Hurlin Granger causality test results confirmed bidirectional causality between trade openness and energy consumption and between trade openness and economic growth. Again, unidirectional Granger causality is running from trade openness and CO₂ emissions. Policy recommendations are further proposed.

Non-linear threshold effect of financial development on renewable energy consumption: evidence from panel smooth transition regression approach

Financial development is identified as one of the significant factors that affect energy consumption and has been widely discussed in the literature. However, the association between financial development and renewable energy consumption is still at its earlier stage and is limitedly explored. Therefore, the purpose of this study is to examine the non-linear association between financial development and renewable energy consumption in the top renewable energy consumption countries. The study utilized the newly introduced econometric technique panel smooth transition regression (PSTR) model with two regimes on annual panel data consisted of years 1997-2017. The result confirmed that all the financial development indicators increase renewable energy consumption but affect renewable energy consumption differently. Moreover, the economic growth and industrial structure showed a positive and significant association in both regimes, whereas the population showed a negative relationship with renewable energy consumption in a low growth regime but the association becomes positive in high growth regimes. The study suggested several policies for the top renewable consumption countries.

Income Inequality and CO2 Emissions in Developing Countries: The Moderating Role of Financial Instability

This paper studies the effects of income inequality and financial instability on CO2 emissions in the presence of fossil fuel energy, economic development, industrialization, and trade openness. Moreover, the present study is the first to examine the moderating role of financial instability between income inequality and CO2 emissions. We utilized panel data of forty-seven developing countries for the period 1980–2016 by utilizing the stochastic impacts by regression on population, affluence, and technology (STIRPAT) model. The empirical outcomes in all models indicate that income inequality and industrialization significantly reduce environmental degradation, while fossil fuel, trade openness, and economic growth decrease the quality of the environment. However, financial instability (without interaction term) shows no significant link to environmental quality, whereas (with interaction term) it shows a significant negative effect on CO2 emissions. In addition, the result of the interaction variable reveals that an increase in inequality, ceteris paribus, in combination with the rise in financial instability, is expected to increase pollution. Furthermore, there exists a bidirectional causal association among income inequality, financial instability, fossil fuel, trade openness, industrialization, economic growth, and the interaction variable with CO2 emissions.

The long-run effects of energy use, urbanization and financial development on carbon dioxide emissions

Purpose

This study aims to fill the gap in existing studies that have analyzed the drivers of carbon dioxide (CO2) emissions. The author investigate the long-run effects of energy types, urbanization, financial development and, the interaction between urbanization and financial development on CO2 emissions.

Design/methodology/approach

Stochastic impacts by regression on population, affluence and technology model served as the framework for empirical modeling. Using annual time-series data for Tunisia, autoregressive distributed lag bounds test was used to examine the cointegration of the variables. Also, the fully modified ordinary least squares was used to estimate the emission effect of the explanatory variables. Further investigations were done using the principal component analysis and variance decomposition analysis.

Findings

Income, urbanization, trade and financial development exert upward pressure on CO2 emissions. However, the interaction between urbanization and financial development reduces the emission of CO2. Furthermore, primary energy use, energy intensity, electricity consumption and fossil fuel consumption have positive effects on carbon emission, while combustible renewables and waste, and electricity production from natural gas have negative effects on carbon emission.

Practical implications

The policy implication/recommendation indicates that the financial sector’s authorities can combat carbon emission by properly regulating the development and activities of the financial sector in urban areas in Tunisia. The promotion of the development and usage of cleaner energy is recommended to help reduce carbon emission. Policymakers need to promote environmentally friendly economic growth and development agenda.

Originality/value

The contribution of this study to the environmental degradation literature is that it offers evidence from Tunisia, which has not received much empirical attention. It also examines the effect of various forms of energy usage on carbon emission. To the best of the author’s knowledge, this is the first study to examine the interaction effect between urbanization and financial development on carbon emission. Also, if not the first, this study is among the earliest to use the principal component analysis as a part of the prediction of the carbon emission effect of energy variables.

Relationship between energy demand, financial development, and carbon emissions in a panel of 101 countries: "go the extra mile" for sustainable development

The objective of the study is to examine the impact of energy demand on carbon emissions in mediation of financial development and economic growth in a panel of 101 countries by using the time series data from 1995 to 2018. The study employed dynamic GMM estimator in order to reduce possible endogeneity in the given model. Further, the study used Granger causality and innovation accounting matrix (IAM) to find the causal relationships and variance error shocks between the variables. The results show that energy demand and FDI inflows increase carbon emissions, while financial development decreases carbon emissions across countries. Moreover, the results confirmed the inverted U-shaped relationship between income and emissions with a turning point of US$43,500. Among 101 countries, only 13 countries hold environmental Kuznets curve (EKC) hypothesis as their per capita income surpassed the stated turning point, while the remaining countries exhibit "race to the bottom" hypothesis. The feedback relationship is established between (i) income and carbon emissions, (ii) money supply and carbon emissions, and (iii) FDI inflows and energy demand across countries, whereas one-way linkages found in (i) carbon emissions to money supply, (ii) energy demand to money supply, (iii) money supply to FDI inflows and income, and (iv) energy demand to income across countries. The IAM analysis shows that energy demand, FDI inflows, and money supply will likely to increase carbon emissions, while money supply will decrease carbon emissions over a time horizon.

Analysis on the nexus amid CO2 emissions, energy intensity, economic growth, and foreign direct investment in Belt and Road economies: does the level of income matter?

This study determines the relationship between economic growth, foreign direct investment, energy intensity, and carbon dioxide emissions along the Belt and Road initiative considering their income classification. The study employs data from 1995 to 2015, the panel unit root test, Westerlund cointegration test, augmented mean group estimation, and the Dumitrescu-Hurlin Granger causality test. The empirical results indicate that (1) the data from all income group had cross-sectional association; (2) the variables are integrated of order 1 after first difference; (3) The variables under discussion were cointegrated; (4) at 1% increase in energy consumption, carbon dioxide emissions increased by 0.8606%, 0.9082%, 0.91815%, and 0.8043% in high-, upper-middle-, lower-middle-, and low-income countries, respectively; (5) a bidirectional causal relationship was found between foreign direct investment and carbon dioxide across all income groups. Energy intensity has a bidirectional association with carbon dioxide in low-, upper-middle-, and high-income countries but one-way association in lower-middle-income countries. These recent methodologies take cross-sectional dependence into account in their estimation and findings show that the causal affiliations together with long-run estimated effects amid employed variables are influenced by the different income levels of Belt and Road countries in a tender to reduce carbon dioxide emissions. The empirical results point to some important policy implications.

Do technological innovations and financial development improve environmental quality in Egypt?

Achieving the seventh Sustainable Development Goal which is clean energy at affordable prices depending on technological innovation is one of the most strategic objectives of Egypt, aiming at mitigating carbon dioxide emissions and enhancing sustainable economic growth (IRENA 2018b). Based upon this goal, the study explores the relationships among carbon dioxide emissions, technological innovation, alternative energy resources, economic growth, and financial development in Egypt over the period 1971-2014. Auto-regressive distributed lag (ARDL), fully modified ordinary least square (FMOLS), Stock and Watson dynamic ordinary least square (DOLS), and Toda-Yamamoto approaches are employed. The results show the existence of cointegration among the variables. Moreover, empirical results show that while technological innovation and alternative energy resources improve environmental quality, financial development and economic growth deteriorate it. The findings obtained from Toda-Yamamoto approach reveal the existence of bi-directional causal relation between environmental degradation and economic growth. Also, environmental degradation causes technological innovation and financial development causes environmental degradation and economic growth. Thus, several policy implications should be suggested to policymakers as enhancing the development of technological innovation especially in renewable energy sector to improve environmental quality.

Industrialization, Freight Transport and Environmental Quality: Evidence from Belt and Road Initiative Economies

Belt and Road initiative has been proposed by China to initiate the cooperation among relevant countries in sector of energy and Trade. The study investigate highlighting the relationship between industrial value added per capita, transport freight and CO₂ emission among the partner countries of Belt and Road initiatives by using panel of 33 economies from 1986-2017. Study includes panel autoregressive distributed lag model (ARDL) to estimate the long-run relationship among variables. Estimated results of pool mean group (PMG) indicates that increase in industrial value added per capita and transport freight deteriorates the quality of environment in long-run. However, short-run results of granger causality reveals positive and unidirectional causality running from industrial value added per capita to emission of CO₂ while transport freight and CO₂ emission shows bidirectional causality. The study emphasized to formulate environment friendly policies in industrial and transport sector.

Revealing heterogeneous causal links among financial development, construction industry, energy use, and environmental quality across development levels

This work investigates the dynamic heterogeneous causal links among financial development, construction industry, energy use, and environmental quality across the development levels, for 30 Chinese provinces during the period 2001-2016. For this purpose, a model of environmental quality has been constructed introducing the financial development and construction industry as endogenous factors. A Pedroni's cointegration is employed and found the long-run cointegrating mechanism among the variables of interest. The dynamic common correlated effects mean group approach (DCCEMGA) is adopted to estimate the impact elasticities. Moreover, for robustness check, a sensitivity analysis is conducted employing common correlated effects mean group approach (CCEMGA). The main results are first, a two-way positive causal bridge is existent between gross domestic product (GDP) and energy use, construction industry and GDP, and financial development and GDP. In terms of the contribution of the construction industry to economic performance, construction industry-driven growth acceleration impact is observed. Second, a one-way positive causal link is identified running from financial development (both the banking sector and stock market) to the construction industry and is termed as finance-driven construction promotion effect. Also, a one-sided positive causal connection is operating from financial development and construction industry to energy use and carbon dioxide emissions. Finally, a standard environmental Kuznets curve (EKC), financial development-augmented EKC, and construction industry-augmented EKC hypotheses are found valid in the whole country and eastern region of China. Based on empirics, a regional heterogeneity has been observed in terms of the degree of impact and statistical significance while comparing the regional panels. The sensitivity analysis proved the empirical results to be robust and reliable. Moreover, based on the findings, policy recommendations are documented. Graphical abstract.

Dynamic linkages among CO2 emissions, human development, financial development, and globalization: empirical evidence based on PMG long-run panel estimation

This study investigates the impact of the human capital index, globalization, and financial development on carbon dioxide of grouping OECD countries using pool mean group estimation technique from 1990 to 2015. This study also applies the second-generation cross-sectional augmented Dickey-Fuller and cross-sectional Im, Pesaran, Shin panel (CIPS) unit root, and the latest (Westerlund 2008) cointegration tests for further investigations. The result shows that both the human development index and financial development stimulate environmental improvement by using PMG long-run panel estimation approach. Furthermore, the pairwise Dumitrescu-Hurlin panel causality results prove the two-way causal association between financial development and carbon emissions. The unidirectional causality running from globalization and human development index towards carbon emission is also supported. Based on the aforementioned results, we provide a set of recommendations for policy implication. Graphical abstract.

Nexus between financial development, energy consumption, income level, and ecological footprint in CEE countries: do human capital and biocapacity matter?

In recent decades, climate change and environmental pollution have been at the center of global environmental debates. Nowadays, researchers have turned their attention to the linkage between real output and environmental quality and test the environmental Kuznets curve. Majority of the studies focus on a single pollutant aspect and measure the deterioration of the environment through carbon emission (CO₂) only. In contrary, the current study uses a comprehensive proxy, ecological footprint, to measure the environmental quality of the sixteen Central and Eastern European Countries (CEECs). The aim of this paper is to discover the impact of financial development, economic growth, and energy consumption (renewable and non-renewable) on the environment. In addition, for the first time, the current study includes biocapacity and human capital in the growth-energy-environment nexus in the case of CEECs. In doing so, we used annual data of sixteen CEE countries in perspective of the One Belt One Road (OBOR) initiative and cover the period of 1991-2014. For reliable findings, this study focuses on second-generation econometric approaches to check stationarity, cross-sectional dependency, and co-integration among the model parameters. The long-run estimations of the "Dynamic Seemingly Unrelated-co-integration Regression" (DSUR) signify that the effect of economic growth on ecological footprint is not stable and validate N-shaped relationship for cubic functional form between per capita income and ecological footprint (environmental quality). Empirical evidence divulges that financial development and energy use significantly contribute to environmental degradation while renewable energy improves environmental quality by declining ecological footprint significantly. Moreover, the significant effects of biocapacity and human capital are positive and negative on the ecological footprint, respectively. In robustness check through the "Feasible Generalized Least Square" (FGLS) and "Generalized Method of Moment" (GMM) models, we found consistent result. Lastly, the "Dumitrescu-Hurlin (D-H) Panel Causality Test" demonstrates that two-way causal relationship exists between EF and GDP, EF and FD, EF and EU, EF and BC, and EF and HC, while one-way causality is running from RE to EF. This study puts the present scenario of CEE economies in front of the policymakers and suggests that they should consider the vital role of renewable energy and human capital to get sustainability.

The nexus between financial development, globalization, and environmental degradation: Fresh evidence from Central and Eastern European Countries

Global warming and greenhouse gas emissions have become a severe threat to our ecosystem. Prior studies on environment posit that ample exhaustion of fossil fuels for energy is one of the fundamental causes of environmental degradation and naturally replenished energy sources are affordable over fossil fuels. This study set out to examine the role of financial sectors and globalization (in the presence of energy and renewable energy consumption) for a sustainable environment in the panel of Central and Eastern European (CEE) countries in One Belt and One Road initiative perspective. The current study uses annual data of 16 CEE countries covering the period of 1980 to 2016. After confirmation of cross-sectional dependency and co-integration among variables, we applied the Dynamic Seemingly Unrelated Regression and Dumitrescu-Hurlin causality approach for long-run estimations and to check the causal relationship, respectively. The empirical findings of the study certify the existence of an environmental Kuznets curve for the selected panel countries. Globalization is enhancing the environmental quality of the CEE economies. It is important to note that energy consumption and renewable energy consumption have a positive and statistically significant whack on carbon emission. In addition, we do not find a significant link between financial development and carbon emission. Granger casualty test confirms a two-way causal relationship between economic growth and carbon emission, globalization and environmental degradation, globalization and renewable energy consumption, economic growth and renewable energy consumption, and between financial development and energy consumption. Moreover, we found one-way causality from energy consumption (renewable and non-renewable) to carbon emissions. Based on the findings, a number of appropriate policy suggestions are presented in the perspective of Central and Eastern European Countries.