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Green Finance and Globally Competitive and Diversified Production: Powering Renewable Energy Growth and GHG Emission Reduction

Year: 2024

Type: article

Abstract: Increased greenhouse gas (GHG) emissions have triggered a global climatic shift that threatens all species. The last century witnessed many improvements in several industries that elevated GHG emissions to levels not seen in several years. Energy usage is a major source of GHG emissions. The current study will examine how green finance and economic fitness (globally competitive and diversified production) synergistically affect GHG emissions and renewable energy growth. GMM, FMOLS, and quantile regression were used to analyze the OECD economies. Green financing and economic fitness reduced GHG emissions and increased renewable energy use in all three models. The synergistic effect of green financing (GF) and economic fitness (EFI) shows that nations can significantly mitigate the emission of greenhouse gases (GHGs) and encourage the adoption of renewable energy sources. Green financing and economic fitness (EFI) seem to work better in high-carbon economies than in low-carbon ones. GF has a greater impact on greenhouse gas (GHG) emissions in countries with higher emissions. In both high- and low-emission countries, good governance, regulatory frameworks, economic risk, and developed human capital help reduce greenhouse gas emissions. However, GDP affects GHG emissions positively in all OECD countries. Moreover, GDP, effective government, quality regulations, economic risk, and human capital promote renewable energy use in economies. Private enterprises and households need financial incentives to adopt renewable energy technology quickly. Businesses may finance environmental projects without government assistance. Complex and varied product manufacturers are encouraged to employ renewable energy and minimize greenhouse gas emissions to increase economic resilience.

Source: Polish Journal of Environmental Studies

DOI: 10.15244/pjoes/185350

Authors: Er Yi, Shamsheer u Haq, Babar Aziz

Institutions: Shanghai University of Finance and Economics, University of Okara, University of Education, Government College University, Lahore

Language: English

Topic: Energy, Environment, Economic Growth

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDGs: Climate action, Affordable and clean energy, Responsible consumption and production

Open Access status: diamond

OpenAlex ID: W4402808225