Financial inclusion and threshold effects in carbon emissions
Nidhaleddine Ben Cheikh and
Christophe Rault
Energy Policy, 2024, vol. 192, issue C
Abstract:
Although financial inclusion would induce greater pollutant emissions through economic activity, improved access to financial services may facilitate investment in clean technologies. This study investigates whether financial inclusion has influenced the dynamics of carbon dioxide (CO2) emissions over the last decade using a sample of 70 countries. We implement panel threshold techniques to explore possible regime shifts in environmental quality. Our results reveal that the influence of increased financial access on air pollution depends on the economic development stage. While financial inclusion can increase CO2 emissions in lower-income regimes, environmental quality appears to be enhanced, with more inclusiveness at later developmental stages. Less-developed countries require more robust environmental policies to align their financial inclusion initiatives with sustainable economic development.
Keywords: Financial inclusion; Carbon emissions; Panel threshold modeling (search for similar items in EconPapers)
JEL-codes: C23 O16 O44 Q53 Q56 (search for similar items in EconPapers)
Date: 2024
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Working Paper: Financial Inclusion and Threshold Effects in Carbon Emissions (2024)
Working Paper: Financial Inclusion and Threshold Effects in Carbon Emissions (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:192:y:2024:i:c:s0301421524002854
DOI: 10.1016/j.enpol.2024.114265
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