The impacts of climate finance and digitalization on resources and energy intensity: Evidence from global south

Dinkneh Gebre Borojo and Ningning Liu

Energy, 2025, vol. 332, issue C

Abstract: This study examines the heterogeneous effects of climate finance (CF) and digitalization on material resources and energy (MRE) intensity across 73 developing countries (DCs) in the global south (GS) for the period 2000–2021. Additionally, it investigates the effects of CF and digitalization on the MRE intensity, considering income, governance quality (GQ), and regional heterogeneity of countries. It also explores the moderating role of digitalization in the CF and MRE intensity link. The moments quantile regression (MMQR) model is employed to address the heterogeneity concerns. The IV-GMM method, Lewbel's IV-2SLS approach, and other robustness analyses are conducted. The findings indicate that CF and digitalization have negative effects on MRE intensity. The results further confirm that DCs in GS with a lower distribution of MRE intensity benefit more from CF, whereas countries with a higher distribution of MRE intensity benefit more from digitalization. The heterogeneity analysis shows that the role of CF is more pronounced in upper and lower-middle-income DCs, countries with strong GQ, and DCs in Asia. The low-income economies, DCs with better GQ, and DCs in Africa benefit more from digitalization. Moreover, digitalization moderates the role of CF on MRE intensity. Several policy implications are suggested based on the findings.

Keywords: Climate finance; Digitalization; Material resources and energy; Developing countries; Global south (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:energy:v:332:y:2025:i:c:s0360544225028300

DOI: 10.1016/j.energy.2025.137188

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