Environmental impact of the shadow economy, globalisation, and human capital: Capturing spillovers effects using spatial panel data approach

Bolstering environmental sustainability in the BRICS countries: The role of natural resources, energy diversity, and human capital in sustainable development

The BRICS countries are working destructively to achieve the emission targets since diminishing global warming, and climate change has become the major concentration of various policy initiatives. In order to propose appropriate policy suggestions, this study examines the impact of forest area, renewable energy use, fossil fuel energy, and other natural resources as vital determinants of carbon emissions in BRICS countries from 1990 to 2020. After confirming the significant cross-sectional dependence, this study employs the second-generation econometric approaches to estimate the long-run coefficients/elasticity. The empirical evidence exposes that other natural resources designate a positive impact on the pollution level in all the quantiles except the first (10th and 20th) and last (80th and 90th) quantiles. Similarly, non-renewable energy utilization is observed to have a significant and positive influence on pollution levels in all quantiles except middle quantiles (i.e., 40th, 50th, and 60th), increasing pollution levels practiced in the BRICS countries. Moreover, the outcomes for forest area, human capital, and renewable energy are significant and negative through the inrended quantiles. The important implication of this study is that output gains from forest area, and other natural resources within the BRICS countries must be connected for investment in alternative and greener energy for achieving sustainable environmental targets.

Do renewable energy sources perfectly displace non-renewable energy sources? Evidence from Asia-Pacific economies

The existing scholarly discourse surrounding the energy transition has long operated on the assumption of perfect displacement of non-renewable energy. However, an evolving set of studies highlights an intricate web of inefficiencies and complexities that prevent the perfect displacement of fossil fuel energy with renewable energy production. Since this could carry serious implications for the environmental targets of several economies, it is crucial to accurately and continuously measure the actual extent of fossil fuel displacement. Within this framework, this study empirically investigates the extent of non-renewable energy displacement by renewable energy for a balanced panel of seven Asia-Pacific (APAC) countries between 1989 and 2015. The outcome function also controls for globalisation, real GDP per capita, and crude oil prices. After implementing the necessary diagnostics, the panel cointegration establishes a significant long-run relationship among the selected variables. The PMG-ARDL estimation indicates that renewable energy production and globalisation significantly reduce the fossil fuel energy production, whereas real GDP per capita and crude oil prices induce it positively. However, the coefficient of renewable energy production is only - 0.39, indicating that more than 2.5 units of renewable electricity are necessary to displace a unit of non-renewable energy. As such, this study concludes that the current energy transition in Asia-Pacific region is not perfect. These results are robust to the usage of the FGLS estimation technique. The study suggests the adoption of a new energy transition that allows greater displacement of fossil fuel energy as well as gradual reduction in overall energy use.

Evaluating the role of financial globalization and oil consumption on ecological quality: A new perspective from quantile-on-quantile granger causality

Global warming has progressed into a pressing global concern, primarily driven by human activities. To address this issue, it is vital to identify the key drivers of ecological quality and develop effective policies in response. Consequently, this study seeks to empirically examine the causal effect of financial globalization, economic growth, economic policy uncertainty, and oil consumption on the load capacity factor (LF) in Brazil. The analysis utilizes quarterly data spanning from 1990 to 2021. In this pursuit, the study introduces an array of quantile-based methodologies, encompassing quantile ADF, PP, and KPSS tests, as well as the innovative Quantile-on-Quantile Granger Causality (QQGC) approach. The QQGC represents a notable advancement beyond traditional quantile Granger causality (QGC) methods, as it accounts for the conditional distribution of dependent and independent variables. This study bridges a critical gap in the existing literature by introducing the QQGC to capture the causal influence of the regressors on LF. The findings derived from the QQGC analysis indicate that financial globalization, economic growth, economic policy uncertainty, and oil consumption significantly predict LF across all quantiles. These results offer valuable insights that can inform the formulation of effective policies and strategies aimed at addressing ecological quality and mitigating the impacts of global warming.

Unregulated economic activities and the environment: The role of fiscal policies

African countries are characterized by high unofficial activities, coupled with a fiscal structure that could either undermine or promote these activities to affect the environment. This study examines the direct and indirect environmental impacts of the unregulated economy and the fiscal instruments of government expenditure and tax using the panel quantiles regression technique. Driven by data availability, our analysis covers 46 countries when the fiscal variables are not considered, while 41 and 38 countries are respectively included in the models involving government expenditure and tax revenue from 2000 to 2016. We discover that the direct impact of unofficial economic activities is unfavourable on the environment, as it increases carbon emissions. The direct impacts of the fiscal policies are heterogeneous. The environmental effect of government expenditure changes from favourable to unfavourable as the countries move from low to high emissions levels. On the other hand, tax is only environmentally friendly in countries with moderate levels of emissions. The interactive effect of an unregulated economy and government expenditure worsens and improves the environment at low and high emissions levels, respectively. The results are heterogeneous for the interactive effect of unregulated economy and tax, although they are more biased toward a satisfactory impact on the environment at the extreme quantiles. Appropriate regulation of informal activities and the design of effective fiscal policy frameworks for environmental sustainability are policy derivatives of these findings.

Role of technology management for carbon neutrality in Gulf economies: the role of social globalization and financial development

This study is founded on the United Nations' Sustainable Development Goals (SDGs) for 2030, particularly SDGs 8, 11, 12, and 13, among others. Investigating the impact of nonrenewable energy, social globalization, financial development, and ICT on CO2 emissions in the Gulf nations, data from 1992 to 2019 was employed using advanced panel methodologies. Both linear and nonlinear autoregressive distributed lag techniques, along with a panel causality approach, were utilized for a comprehensive analysis. These extensive investigations offer robust insights into the ecological sustainability dynamics within the Gulf nations. The empirical findings highlight that positive (negative) shifts in social globalization, economic growth, ICT, and nonrenewable energy correlate with an increase (decrease) in CO2 emissions, while positive (negative) shifts in financial development contribute to a decrease (increase) in CO2 emissions. These results emphasize the need for a policy framework aligned with the SDGs, advocating an inclusive policy framework tailored for the Gulf nations, aiming to drive progress towards achieving SDGs 7, 8, 9, 13, and 16.

The impact of informality and institutional quality on environmental footprint: The case of emerging economies in a comparative approach

The endeavor to implement the 2030 Agenda of national and international stakeholders became increasingly impetuous, considering the wide range of uncertainties and risks. The new humans-centered development model built on the prominence of environmental and social values seeks to reinforce communities' resilience and mitigate environmental risks, leaving no one behind. For this to happen, solid and effective institutions, the right environmental policies, and a safe statutory labor framework are the sine qua non. In this study, we evaluated the effects of informality, institutional quality, and renewable energy consumption on ecological footprint of two groups of emerging countries from Europe and Asia from 2002 to 2018. Our results by PMG-ARDL approach highlight dissimilarities between the two groups, showing greater heterogeneity. In this sense, informality is found to have positive and significant effects on ecological footprint in the long run in emerging European countries. In contrast, the effect is negative for emerging Asian countries. In the short run, the effects are less critical in the studied countries between the two groups. Institutional quality variables impacted environmental quality differently. In this sense, it is detrimental for policymakers to consider concerted measures to decrease institutional vulnerabilities and reduce the level of the informal economy. The outcome of this study concurs with a complete awareness of the importance of informality and institutional quality to mitigate social and environmental risks conjunctively.

On the link between shadow economy and carbon dioxide emissions: an analysis of homogeneous groups of countries

In the framework of an environmental Kuznets curve, the linkage between shadow economy and carbon dioxide (CO2) emissions was evaluated for 145 countries from 1991 to 2017. In assessing the effect of the shadow economy on CO2 emissions, we used panel quantile regression, panel fixed effects, and panel smooth transition regression as estimation methods. In addition, to deal with parameter heterogeneity, we resorted to the procedure of Lin and Ng (2012). We found two country groups that share homogeneous parameters. No environmental Kuznets curve was found for the set of all countries. Nevertheless, one was found for each of the homogeneous parameter country groups. This result supports different turning points for different groups of countries. Shadow economy contributed to reducing CO2 emissions in group 1 and aggravated it in group 2. Manufacturing was revealed to be statistically significant for the countries of group 1. Fossil fuel rents increased the CO2 emissions, mainly in group 2. Urbanization contributed to the hike of CO2 emissions in both country groups but much more intensely for group 1. Evidence of a tendency for decreasing CO2 emissions was also found, reflecting the efficiency gains over time.

Does human capital matter for energy consumption in China? Evidence from 30 Chinese provinces

The impact of human capital on energy consumption is an important economic and environmental issue, especially in a country like China with a strong energy demand and continuously improving education levels. This study uses panel data from 30 provinces in China from 2000 to 2020 to explore the impact of human capital on energy consumption. Empirical research shows that human capital can not only reduce local energy consumption but also reduce energy consumption in surrounding areas, through structural, technological, and knowledge spillover effects. The impact of human capital on energy consumption exhibits a U-shaped curve, decreasing first and then increasing, when economic growth reaches a threshold level. As industrial structure and urbanization develop, the impact of human capital on energy consumption increases. This study inform policy by demonstrating the energy conservation and emission reduction effects of human capital and provide insights for investors and policymakers.

The role of renewable energy investment and energy resource endowment in the evolution of carbon emission efficiency: spatial effect and the mediating effect

With climate change caused by massive greenhouse gas emissions emerging as an issue of global concern, it is urgent to improve carbon emission efficiency (CEE) for countries along the Belt and Road (BRI). Considering the resource endowment characteristics of green development in BRI countries, the super-efficiency slacks-based measure (SBM) model is adopted to evaluate the current status and tendency of CEE in 60 BRI countries, while the Global Malmquist-Luenberger (GML) index to quantify the spatial and temporal variation and dynamic evolution of CEE. Subsequently, from the perspective of energy development and utilization, the spatial Durbin model (SDM) and the mediating effect model are employed to empirically examine the spillover effects and driving mechanisms of renewable energy investment and energy resource endowment on CEE. Empirical results reveal that (1) from a static perspective, the CEE of BRI countries is generally poor and unevenly distributed in terms of temporal and spatial dimensions, with significant room for enhancement. (2) Referring to the dynamic level, the GML index featured a U-shaped fluctuation, with technological progress contributing to the improvement of CEE. (3) There is a significant positive effect of renewable energy investment on CEE in the home country and neighboring countries, while energy resource endowment presents a remarkable adverse correlation. Consequently, it is suggested that inter-regional cooperation among BRI countries should be strengthened to reinforce renewable energy investment, exert the technology and knowledge spillover effect sufficiently, and break the resource curse in the environmental field. (4) The mediating effect model confirms the significant mediating mechanism of technological innovation. Renewable energy investment can enhance the CEE of BRI members by promoting the positive mediating effect of technological innovation, while energy resource endowment can inhibit the local level of technological innovation and indirectly inhibit the CEE of BRI members. The findings provide new ideas on the green development and ecological sustainability of the energy industry in BRI members and other economies.

The influence of shadow economy, environmental policies and geopolitical risk on renewable energy: A comparison of high- and middle-income countries

Given the alarming rate of climate change and environmental degradation, major countries are seeking ways to curtail environmental damage and attain sustainability in the future. In the quest for a green economy, countries are motivated to adopt renewable energy that can assist in resource conservation and efficiency. Accordingly, this study examines the diverse effects of the underground economy, environmental policy strictness, geopolitical risk, gross domestic product, carbon emissions, population, and oil prices on renewable energy for 30 high- and middle-income countries from 1990 to 2018. The empirical outcomes based on quantile regression document significant variations across two country groups. For instance, for high-income countries, the shadow economy has a detrimental effect across all quantiles but it is statistically significant at the top quantiles. Nonetheless, the effect of the shadow economy on renewable energy is detrimental and significant statistically across all quantiles for middle-income countries. In the context of environmental policy stringency, the effect is positive across both country groups, though there is heterogeneity in outcomes. Geopolitical risk has a positive influence on the deployment of renewable energy for high-income countries but negatively impacts renewables for middle-income countries. As far as policy suggestions are concerned, the policymakers of both high- and middle-income countries need to take steps to constrain the growth of the shadow economy by adopting effective policy strategies. Policies need to be implemented for middle income-countries to reduce the unfavorable effect of geopolitical uncertainty. The findings of this study contribute to a better and more precise understanding of factors shaping the role of renewables whereby the energy crisis would be mitigated.

The potency of natural resources and trade globalisation in the ecological sustainability target for the BRICS economies

The BRICS nations have yet to significantly contribute to achieving Sustainable Development Goals (SDG) 7 and 13. Dealing with this problem might necessitate a policy shift, which is the main topic of this research. Therefore, the current study scrutinizes the interrelationship between natural resources, energy, trade globalisation and ecological footprint using panel data from the period between 1990 and 2018 for the BRICS nations. To assess the interrelationship between ecological footprint and its determinants, we used the Cross sectional autoregressive distributed lag (CS-ARDL) and common correlated effects. mean group (CCEMG) estimators. The findings show that economic progress, and natural resources lessen ecological quality, while renewable energy and trade globalization improves ecological quality in the BRICS nations. Based on these results, the BRICS nations need to upgrade their use of renewable energy sources and improve the structure of their natural resource endowments. Furthermore, trade globalisation necessitates immediate policy responses in these nations since it reduces ecological damage.

Invisible economy, performance assessment of local governments, and environmental regulation in China

Currently, environmental regulation in China is characterized by partial improvement and overall deterioration of the environment. To investigate the impact of China's environmental regulation on the country's environment, we consider the invisible economy by constructing a Stackelberg game model between local governments and polluting enterprises based on the Chinese institutional structure. We derive the following findings: (1) Increasing the invisible economic production scale causes the enterprise to reduce the pollution control level, resulting in increasing total pollutant emissions. Increasing the invisible economy production scale increases the enterprise's profit but undermines the utility of the local government. (2) The higher the proportion of environmental performance in the performance assessment of the local government is, the greater is the incentive for the local government to regulate the environment, which can force the enterprise to improve the pollution control level. However, there is an inefficient range for the proportion of environmental performance. (3) The lenient the pollutant emissions limit is, the weaker is the local government's environmental regulation intensity and the enterprise's pollution control level. (4) The higher the unit fine levied on the enterprise for excessive emissions is, the lower is the environmental regulation intensity of the local government, which can bring about improvement in the enterprise's pollution control level and reduction in total pollutant emissions. The results of the study have positive effects on sustainable environmental regulation in China under the invisible economy.

Impact of human capital on the green economy: empirical evidence from 30 Chinese provinces

In China, exploring the relationship between human capital and green economy in the context of economic transformation can promote the construction of an ecological civilization and high-quality economic development. This paper is dedicated to assessing the impact of human capital stock, human capital structure, and the difference between the two on China's green economy. Using the super-efficiency slack-based measure (SBM) model, this paper evaluated the green total factor productivity (GTFP) of 30 Chinese provinces to assess the greenness of its economy and analyzed its spatiotemporal evolution from 2000 to 2017. A spatial error model (SEM) was established to explore the impact of human capital on green economy. The results show that (1) the GTFP of China increased continuously from 0.219 to 0.457, showing a regional spatial differentiation of "eastern region > central region > western region." The spatial gaps of the green economy in the east-west and north-south directions are narrowing. (2) Moran's I index and Moran's I scatter plot indicate a significant spatial correlation between human capital and China's green economy. The local spatial correlation between human capital and green economy is mainly characterized by "high-high" and "low-low" types of agglomeration. (3) The effects of human capital stock and human capital structure on green economy were both positive, with coefficients of 0.0005 and 0.1601, respectively, but the effects of human capital structure were not significant. (4) The results of regional regression show that the difference between the human capital impact coefficients on green economy in the eastern and midwestern regions is small. The impact of human capital stock and human capital structure on green economy is consistent with the national level results. It can be preliminarily concluded that the development of China's green economy relied more on improving the human capital stock than on the improvement of the human capital structure. This study further enriches the literature on the green economy and provides information that can support government policy-making.