Unraveling the Nexus Between Financial Openness and Environmental Quality: Green Finance as the Catalyst in CEE Countries
Azer Dilanchiev,
Chanyanan Somthawinpongsai (),
Bobur Urinov () and
Elchin Eyvazov ()
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Chanyanan Somthawinpongsai: Faculty of Liberal Arts, Shinawatra University, Bang Toei, Sam Khok District, Pathum Thani 12160, Thailand
Bobur Urinov: Corporate Governance Department, Tashkent State University of Economics, Uzbekistan
Elchin Eyvazov: Department of Economics, Azerbaijan State University of Economics (UNEC), Baku, Azerbaijan
Journal of Environmental Assessment Policy and Management (JEAPM), 2024, vol. 26, issue 03, 1-43
Abstract:
The use of fossil fuels, which is still seen as the cheapest energy source today, has increased carbon emissions and contributed to the formation of greenhouse gases, and this gas has reached levels that threaten world health. While studies on this problem often question the relationship between production volume, energy use, and carbon emissions, few studies question the effects of the financial assets, which are the providers of investments made for production purposes, on environmental degradation. This study used the fixed effect model and system GMM technique to analyse the moderating effect of green finance in connection to financial openness and environmental quality from 2015 to 2020 in the CEE countries. Findings show, among other things that (1) CO2 in CEE countries is still growing; (2) financial openness is a positive and significant indicator of CO2 emission; and (3) that green finance usage reduces the positive impact of financial openness on CO2 emissions. The study suggests that financial openness, renewable energy (RE) investment, and green technology innovation (GTI)– consistently drive CO2 emissions in CEE countries. The study suggests that policies promoting green finance, particularly RE investment and GTI, can help mitigate environmental degradation and reduce CO2 emissions.
Keywords: Green finance; environmental quality; financial openness; renewable energy investment; CEE countries (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:wsi:jeapmx:v:26:y:2024:i:03:n:s146433322450011x
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DOI: 10.1142/S146433322450011X
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