Political Economy of Clean Energy Transition: The Role of Political Risk and Economic Growth

Jianyu Chen, Yue Fu, Rong Wang and Jie Yang

Politická ekonomie, vol. preprint

Abstract: In the empirical determination of the factors influencing the clean energy transition, the BRICS economies have initiated various policy reforms, such as increased R&D budgets, improvements in technology and political stability. This study analyses the critical role of political risk and economic growth, natural resources, research and development and technological innovation in the clean energy transition in the period 1990-2022. Using panel econometric approaches, this study confirms the heterogeneity of slopes and cross-sectional dependence. Using linear regression with the heteroscedastic panel-corrected standard error approach, the results show that economic expansion, political risk and the quadratic R&D term significantly enhance the clean energy transition. However, natural resources, conventional technological innovation and research and development expenditures are the leading barriers to a clean energy transition in the region. The robustness of these results is validated by a series of panel regressions. Following the empirical outcomes, this study recommends rapid enhancement of the research and development budget, strengthening of governance and institutions and investment in technological innovation to attain a sustainable transition towards clean energy sources.

Keywords: Clean energy; political risk; research and development; economic growth; technological innovation; BRICS (search for similar items in EconPapers)
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DOI: 10.18267/j.polek.1486

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