From Entrepreneurship to Sustainable Futures: Investigating the Nexus Between New Business Density, Economic Growth, and Carbon Emissions

Kamer Ilgin Cakiroglu (), Korkmaz Yildirim, Tunahan Haciimamoglu and Coskun Erkan
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Kamer Ilgin Cakiroglu: The Department of Business, Faculty of Economics and Administrative Science, Recep Tayyip Erdogan University, Rize 53100, Türkiye
Korkmaz Yildirim: The Department of Political Science and Public Administration, Faculty of Economics and Administrative Science, Recep Tayyip Erdogan University, Rize 53100, Türkiye
Tunahan Haciimamoglu: The Department of Economics, Faculty of Economics and Administrative Science, Recep Tayyip Erdogan University, Rize 53100, Türkiye
Coskun Erkan: The Department of Business, Faculty of Economics and Administrative Science, Recep Tayyip Erdogan University, Rize 53100, Türkiye

Sustainability, 2025, vol. 17, issue 12, 1-21

Abstract: The readiness of businesses to address global climate change is pivotal for achieving sustainable development. However, the dynamics of business development remain underexplored, thereby limiting the depth and scope of research in this area. To this aim, the study examines the relationship between CO 2 emissions and new business density (NBD) in the top 14 countries with the highest NBD (Hong Kong, Cyprus, New Zealand, Estonia, Malta, United Kingdom, Australia, Botswana, Iceland, Latvia, Mauritius, Norway, Sweden, and Georgia) from 2006 to 2020, within the framework of Schumpeter’s theory and the environmental Kuznets curve (EKC) hypothesis, incorporating control variables such as renewable energy consumption (REC) and population size. To estimate the relationships between variables, we employ the novel Method of Moments Quantile Regression (MMQR) approach. The findings suggest that higher NBD is associated with increased CO 2 emissions. The results support the EKC hypothesis, positing an inverted U-shaped relationship between economic growth and environmental degradation, and highlight the mitigating effects of REC and population growth on CO 2 emissions. These findings emphasize the need for countries to align labor legislation with sustainable development objectives and to promote strategies grounded in environmental principles, green economic practices, and eco-friendly technologies.

Keywords: sustainable entrepreneurship; new business density; CO 2 emission; economic growth; renewable energy consumption (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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