Empowering sustainable development in emerging economies: The role of renewable energy and domestic investment

Lingning Wang, Shreya Pal, Mantu Kumar Mahalik and Giray Gözgör

Energy Economics, 2025, vol. 148, issue C

Abstract: We empirically examine the effects of renewable- and non-renewable electricity generation, globalisation, and domestic gross fixed capital formation on sustainable development in 14 emerging economies from 1990 to 2022. The findings reveal that both stochastic and absolute convergence exist within the sustainable development indices of these economies. The conditional convergence results indicate that domestic gross fixed capital formation and renewable electricity generation promote sustainable development. In contrast, globalisation and non-renewable electricity production negatively affect sustainable development. Finally, employing Phillips-Sul's club convergence methodology, we identify two distinct convergence clubs: Club 1, comprising Brazil, China, Chile, Colombia, Greece, the Korean Republic, and Malaysia, and Club 2, which includes Hungary, Poland, the Philippines, Saudi Arabia, and South Africa. Therefore, we conclude that while emerging countries strive for economic growth, tailored policy frameworks are essential to balance environmental sustainability and growth objectives, while emphasising the need for international cooperation and sustainable practices across both the clubs.

Keywords: Sustainable development; Renewable energy; Domestic fixed capital; Emerging economies, convergence methods; Panel data (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:148:y:2025:i:c:s014098832500458x

DOI: 10.1016/j.eneco.2025.108631

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