Moderating Effect of Financial Development on the Relationship between Renewable Energy and Carbon Emissions

Yi-Bin Chiu () and Wenwen Zhang
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Yi-Bin Chiu: Institute of Western China Economic Research, Southwestern University of Finance and Economics, Chengdu 611130, China
Wenwen Zhang: School of Management, Xihua University, Chengdu 610039, China

Energies, 2023, vol. 16, issue 3, 1-18

Abstract: This study investigates the moderating effect of financial development on the renewable energy–CO 2 emissions nexus in OECD countries. We find that both composite financial development and banking sector development have an inverted U-shaped impact on CO 2 emissions, while stock market development has a U-shaped impact on CO 2 emissions. Further, an increase in renewable energy will reduce CO 2 emissions, and this reducing impact is affected by different levels of financial development. When promoting financial development, policymakers should pay more attention to its role in enhancing renewable energy, which is related to emissions reduction.

Keywords: CO 2 emissions; renewable energy; financial development; nonlinearity (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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