Digital financial inclusion, the belt and road initiative, and the Paris agreement: Impacts on energy transition grid costs

Muhammad Zubair Chishti (), Xiqiang Xia, Anna Min Du and Oktay Özkan

Finance Research Letters, 2025, vol. 72, issue C

Abstract: We investigate how digital financial inclusion, the Belt and Road Initiative, and the Paris Agreement influence the energy transition grid cost. We propose two new Kendall and Spearman wavelet cross-quantile correlation methods and utilize data from June 1, 2018, to July 31, 2024. Our findings indicate that digital financial inclusion, the Paris Agreement, and artificial intelligence significantly reduce grid costs in the short and long run. Additionally, the Belt and Road Initiative has substantial potential to decrease grid costs, particularly during bullish market conditions in the long run. Conversely, GCOVOL significantly increases grid costs, especially in the long run.

Keywords: Digital financial inclusion; grid cost; BRI; Paris Agreement; Wavelet Cross-Quantile Correlation (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:72:y:2025:i:c:s1544612324015460

DOI: 10.1016/j.frl.2024.106517

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