Drivers of supply chain, environmental innovation, and digital population: The role of inflation and renewable energy on GHG emission in Indonesia

Mindan Zhang, Xiang Ma, Shunhao Mai and Lingli Qing

Energy Economics, 2025, vol. 145, issue C

Abstract: The study examines the impact of the supply chain, renewable energy consumption, environmental technology innovation, inflation, the digital population, and economic development on Indonesia's greenhouse (GHG) emissions from 2000 to 2022. Utilized non-linear ARDL (NARDL) model and quantile regression, this study offers a differentiated insight into GHG emissions, promotion of renewable energy, green economy, and investment in technologies that support environmental sustainability. The NARDL model depicts that renewable energy negatively impacts GHG emissions in the short term. At the same time, environmental innovation and digital population reduce GHG emissions in the long run. Inflation positively affects GHG emissions in both the short and long run. GDP shows mixed results: positive growth slightly reduces emissions, while economic downturns (negative growth) lead to a stronger reduction, likely due to reduced industrial activity. The supply chain shows insignificant results with GHG emissions in Indonesia. The quantile regression findings show that renewable energy and environmental technology have a negative impact on GHG emissions at lower quantiles but have less effect at higher quantiles. Inflation shows a positive relationship with GHG emissions across quantiles. Digital population growth has a slightly positive relationship with GHG emissions at higher quantiles. GDP shows a complex pattern, with positive growth leading to increased emissions at higher quantiles, while at lower quantiles, economic downturns contribute to emission reductions. These findings revealed that renewable energy and environmental technology reduce GHG emissions, while inflation consistently drives higher emissions. The findings suggest that targeted policies should consider emission intensity for more effective environmental strategies.

Keywords: GHG emission; Supply chain; Renewable energy consumption; Environmental technology; Digital population; Non-linear ARDL; Sustainable development (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:145:y:2025:i:c:s0140988325002865

DOI: 10.1016/j.eneco.2025.108462

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