Greenfield Investment as a Catalyst of Green Economic Growth

Aleksy Kwilinski (), Oleksii Lyulyov and Tetyana Pimonenko
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Aleksy Kwilinski: Department of Management, Faculty of Applied Sciences, WSB University, 41-300 Dabrowa Gornicza, Poland
Tetyana Pimonenko: Department of Management, Faculty of Applied Sciences, WSB University, 41-300 Dabrowa Gornicza, Poland

Energies, 2023, vol. 16, issue 5, 1-16

Abstract: The intensification of countries’ growth causes the depletion of natural resources, biodiversity degradation, ecological imbalances, damage, and disasters. The aggravation of ecological issues requires the development of mechanisms for simultaneous achievement of economic, social, and ecological goals. The energy sector is the core direction of economic decarbonization. Therefore, green economic growth requires economic development due to the extension of innovative technologies for renewable energies and relevant investment for that. The study aims to test the hypothesis on the impact of green field investment on green economic growth. The object of the research was countries in the European Union (EU) for 2006–2020. This study applied the Malmquist-Luenberger Global Productivity Index to estimate green economic growth. It considers the resources available for the production process in the country (labor, capital, energy), the desired outcome (gross domestic product) and undesirable results (emissions to the environment) of this process. The study applied the Tobit model to test the hypothesis. The findings confirm the spatial heterogeneity of green economic growth among the EU countries. The asymmetry in technological efficiency and progress limits the efficacy of green innovations. At the same time, the obtained data confirm the research hypothesis. It is shown that along with green investments, economic openness and the efficiency of public governance have a positive effect on the green economic growth of countries. The findings highlight the importance of attracting green investments to increase green innovations in renewable energy, which boost green economic growth. This study explored the linear and direct effects of green investment on the green economic growth while eliminating the transmission impact of other mediating factors. It should be noted that further research should analyze the nonlinear impact of green investment on the green economic growth and the mediating effect, which could be caused by other variables (corruption, governance efficiency, green innovations, etc.).

Keywords: sustainable development; green investment; green growth; green energy; renewable energy (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 (9)

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