Evaluating the role of renewable energy and government consumption in reducing CO2 emissions: A dynamic panel data analysis
The result's identifiers
Result code in IS VaVaI
<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F60460709%3A41110%2F25%3A106237" target="_blank" >RIV/60460709:41110/25:106237 - isvavai.cz</a>
Result on the web
<a href="https://www.sciencedirect.com/science/article/pii/S2772737825000343?pes=vor&utm_source=clarivate&getft_integrator=clarivate" target="_blank" >https://www.sciencedirect.com/science/article/pii/S2772737825000343?pes=vor&utm_source=clarivate&getft_integrator=clarivate</a>
DOI - Digital Object Identifier
<a href="http://dx.doi.org/10.1016/j.horiz.2025.100164" target="_blank" >10.1016/j.horiz.2025.100164</a>
Alternative languages
Result language
čeština
Original language name
Evaluating the role of renewable energy and government consumption in reducing CO2 emissions: A dynamic panel data analysis
Original language description
Reducing CO2 emissions poses a critical challenge for rapidly industrializing lower-middle-income countries (LMICs), where economic expansion pushes enhanced energy consumption, industrial activity, and transportation emissions. While previous research has separately examined the roles of renewable energy adoption and government spending in mitigating emissions, this study uniquely investigates their combined and interactive effects on CO2 emissions in LMICs, providing novel empirical insights through dynamic analysis. This research employs panel data from 26 LMICs spanning 2002 to 2022, utilizing fixed-effects, random-effects, and generalized method of moments (GMM) approaches to address endogeneity, autocorrelation, and unobserved heterogeneity. The robust GMM estimators, handling these issues effectively, ensure reliable and complete causal inferences. The findings from the preferred GMM model indicate that a 1 % increase in renewable energy consumption results in a 0.025 % reduction in CO2 emissions, but a 1 % rise in government expenditure contributes to a 0.0531 % decrease, when spending is environmentally aligned. However, the interaction term between renewable energy and government consumption demonstrates a small but significant positive effect, indicating that poorly targeted fiscal spending may dilute the environmental benefits of renewables. GDP growth and energy use dramatically rise emissions, supporting the Environmental Kuznets Curve (EKC) hypothesis, while urbanization and education show mixed effects. These results underscore the necessity of integrating renewable energy expansion with strategic government fiscal interventions to promote sustainable emission reductions. The study adds to the body of knowledge on sustainable development literature by elucidating the complex interplay between fiscal policy and renewable energy adoption. We recommend that policymakers in LMICs prioritize green-aligned spending and phase out fossil incentives to maximize synergies, fostering scalable models for global climate goals.
Czech name
Evaluating the role of renewable energy and government consumption in reducing CO2 emissions: A dynamic panel data analysis
Czech description
Reducing CO2 emissions poses a critical challenge for rapidly industrializing lower-middle-income countries (LMICs), where economic expansion pushes enhanced energy consumption, industrial activity, and transportation emissions. While previous research has separately examined the roles of renewable energy adoption and government spending in mitigating emissions, this study uniquely investigates their combined and interactive effects on CO2 emissions in LMICs, providing novel empirical insights through dynamic analysis. This research employs panel data from 26 LMICs spanning 2002 to 2022, utilizing fixed-effects, random-effects, and generalized method of moments (GMM) approaches to address endogeneity, autocorrelation, and unobserved heterogeneity. The robust GMM estimators, handling these issues effectively, ensure reliable and complete causal inferences. The findings from the preferred GMM model indicate that a 1 % increase in renewable energy consumption results in a 0.025 % reduction in CO2 emissions, but a 1 % rise in government expenditure contributes to a 0.0531 % decrease, when spending is environmentally aligned. However, the interaction term between renewable energy and government consumption demonstrates a small but significant positive effect, indicating that poorly targeted fiscal spending may dilute the environmental benefits of renewables. GDP growth and energy use dramatically rise emissions, supporting the Environmental Kuznets Curve (EKC) hypothesis, while urbanization and education show mixed effects. These results underscore the necessity of integrating renewable energy expansion with strategic government fiscal interventions to promote sustainable emission reductions. The study adds to the body of knowledge on sustainable development literature by elucidating the complex interplay between fiscal policy and renewable energy adoption. We recommend that policymakers in LMICs prioritize green-aligned spending and phase out fossil incentives to maximize synergies, fostering scalable models for global climate goals.
Classification
Type
J<sub>imp</sub> - Article in a specialist periodical, which is included in the Web of Science database
CEP classification
—
OECD FORD branch
10511 - Environmental sciences (social aspects to be 5.7)
Result continuities
Project
—
Continuities
S - Specificky vyzkum na vysokych skolach
Others
Publication year
2025
Confidentiality
S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů
Data specific for result type
Name of the periodical
SUSTAINABLE HORIZONS
ISSN
2772-7378
e-ISSN
2772-7378
Volume of the periodical
17
Issue of the periodical within the volume
neuvedeno
Country of publishing house
NL - THE KINGDOM OF THE NETHERLANDS
Number of pages
17
Pages from-to
1-17
UT code for WoS article
001599322900001
EID of the result in the Scopus database
2-s2.0-105018906732