Does Environmental Innovation, Foreign Direct Investment and Renewable Energy Consumption Curb Environmental Quality Issues? Evidence from PMG-ARDL Approach

Shrikant Krupasindhu Panigrahi (), Sumathi Kumaraswamy (), Sasikanta Tripathy () and Rabab Hasan Ebrahim ()
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Shrikant Krupasindhu Panigrahi: Economics and Finance Department, University of Bahrain, Sakhir Campus, Bahrain
Sumathi Kumaraswamy: Economics and Finance Department, University of Bahrain, Sakhir Campus, Bahrain
Sasikanta Tripathy: Economics and Finance Department, University of Bahrain, Sakhir Campus, Bahrain
Rabab Hasan Ebrahim: Economics and Finance Department, University of Bahrain, Sakhir Campus, Bahrain

International Journal of Energy Economics and Policy, 2024, vol. 15, issue 1, 213-220

Abstract: One of the major concerns for environmental quality improvement is to reduce reliance on fossil energy consumption. However, there is a possibility that economic developments like foreign direct investment (FDI), urbanization, innovation and renewable energy consumption can mitigate carbon emission and curb environmental quality issues. Hence this examines the impact of innovation, FDI, renewable energy consumption and urbanization on the environmental quality of 46 countries for the period of 1990-2021. The study employed pooled mean group auto regressive distributed lag stationarity estimator for the empirical results. The study findings depict that in the long run, trade openness and innovation positively influence environmental quality, whereas FDI does not significantly affect environmental quality deterioration. Renewable energy consumption plays an important role in relying on fossil energy consumption and reducing carbon emissions. This study gives insights into necessary policy endorsements for the sustainability of environment through innovation.

Keywords: Energy Efficiency; Climate Change; Environmental Quality; Financial Market (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eco:journ2:v:15:y:2024:i:1:id:17027

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DOI: 10.32479/ijeep.17027

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