Building a Sustainable Future: The Nexus Between Artificial Intelligence, Renewable Energy, Green Human Capital, Geopolitical Risk, and Carbon Emissions Through the Moderating Role of Institutional Quality

Amir Iqbal, Wei Zhang () and Sayeda Jahangir
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Amir Iqbal: School of Economics and Statistics, Guangzhou University, Guangzhou 510006, China
Wei Zhang: School of Economics and Statistics, Guangzhou University, Guangzhou 510006, China
Sayeda Jahangir: School of Management, Guangzhou University, Guangzhou 510006, China

Sustainability, 2025, vol. 17, issue 3, 1-40

Abstract: Countries worldwide are focusing on energy efficiency, economic sustainability, and responsible resource management to address climate change and meet sustainable development goals (SDGs). This study investigates how factors such as artificial intelligence, renewable energy, green human capital, geopolitical risk, natural resource rent, and information and communication technology influenced CO 2 emissions in 36 countries between 2000 and 2021. The study also explores how institutional quality moderates these relationships. We employed advanced econometric techniques to address this gap, including panel-correlated standard errors (PCSE) and the Driscoll–Kraay estimations (DKSE) models. A two-step system GMM approach was also used to strengthen the robustness of our findings. The findings reveal that green human capital, renewable energy consumption, and institutional quality can significantly reduce CO 2 emissions. Conversely, artificial intelligence, geopolitical risk, natural resource rent, and information communication technology contribute to increased CO 2 emissions. Institutional quality enhances the positive impact of green human capital and renewable energy on emission reduction. However, it has the opposite effect on artificial intelligence, leading to an even greater increase in CO 2 emissions. These findings underscore the importance of green policies in achieving sustainable development goals. We recommend that policymakers prioritize investing in clean energy and green human capital while strengthening institutional quality to effectively mitigate carbon emissions and meet SDGs. They also regulate AI and ICT carbon footprints and address geopolitical risks through energy diversification and international cooperation.

Keywords: artificial intelligence; renewable energy consumption; green human capital; geopolitical risk; institutional quality; carbon emissions (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
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