Impact of financial inclusion and globalization on environmental quality: evidence from G20 economies

Environmental deterioration in the age of industrialization and production: do industrial competition and renewable energy reduce the ecological burden?

The modern era of globalization, economic development, and increase in manufacturing activity pose severe risks to the natural environment. In this context, industries must prioritize sustainable economic growth and development. Thus, the purpose of this study is to provide insight into industrial competition, renewable energy, economic freedom, manufacturing value added, economic growth, and carbon dioxide emissions (CO2 emissions) in the top ten high-income countries from 1997 to 2019. The results from panel cross-sectional autoregressive distributed lag (CS-ARDL), augmented mean group (AMG), and common correlated effects mean group (CCEMG) techniques revealed that economic growth and industrial production have a harmful influence on CO2 emissions. Meanwhile, industrial competitiveness, renewable energy, and economic freedom are all negatively associated with CO2 emissions. This specifies that industrial competitiveness, renewable energy, and economic freedom are favorably related to environmental sustainability by limiting CO2 emissions in the top ten high-income countries. These findings imply that governments and responsible authorities/policymakers develop strategies to reduce the environmental impact of manufacturing value addition and economic growth in the top ten high-income countries and allocate more financial resources to renewable energy and promote industrial competition.

How do financial inclusion and renewable energy collaborate with Environmental quality? Evidence for top ten countries in technological advancement

The environmental situation of our planet is seriously degraded due to the massive spread of greenhouse gases. Several aspects can influence the quality of the environment. The present study debates the effect of financial inclusion (FI) and renewable energy consumption (REC) on the emissions of carbon dioxide (CO₂) emissions of the top ten countries in technological advancement (TTCTA) over the period 2004-2019. Other deterministic factors are included in the empirical study such as real gross domestic product (GDP), non-renewable energy consumption (NREC), and technological advancement (ATECH) to check their influence on environmental indicators. PMG-ARDL approach, cointegration techniques, and Granger causality tests are applied for the empirics part. In the long run, the outcomes show that real GDP, REC, and technological advancement contribute to decreasing CO₂ emissions, while NREC and FI contribute to increasing emissions levels. In the short run, only GDP and NREC significantly deteriorate the environmental quality. Granger shows a long-run bidirectional causality between CO₂ emissions, economic growth, REC, NREC, and ATECH.