Assessing sustainable development in E-7 countries: technology innovation, and energy consumption drivers of green growth and environment.

Abstract

To combat climate change, a country needs to take part in the development of energy sources and the renovation of its energy infrastructure. Since, green energy production is frequently costly and dangerous, especially in its early stages, capital is one of the barriers to the energy revolution. The aims of the study to analyze the non-linear relationship between energy consumption, financial development, and technology innovation on green economic growth, and environmental pollution indicators including ecological footprint and carbon dioxide emission in the E-7 countries over the period of 1995 to 2022. Using a new panel non-linear autoregressive distribution model (NLPARDL) approach, the results confirm that carbon dioxide emissions, green economic growth, and ecological footprint have a positive and strong long-term correlation with the positive component of the energy use. Conversely, negative shocks are negative and significant with ecological footprint but positive and significant with carbon dioxide emissions and green economic growth. Furthermore, financial development has a positive and substantial relationship with ecological footprint in addition to having a long-term negative and large impact on carbon dioxide emissions and a negative but small impact on green economic growth in a positive shock. Similar to this, financial development negative shock coefficients are significant and negative over the long term when it comes to carbon dioxide emissions and green economic growth, and they are positively significant when it comes to ecological footprint negative component. In the meantime, the long-term positive shock of technology innovation has a negative significant correlation with ecological footprint, ecological footprint a positive and negligible correlation with green economic growth, and a positive and significant correlation with carbon dioxide emission. Similarly, technology innovation long-term negative shock coefficients for carbon dioxide emissions and green economic growth are both negative and significant; on the other hand, technology innovations long-term negative shock coefficients for the negative component of ecological footprint are positively significant. Based on the results, E-7 nations need to invest in projects that utilize energy and technology innovation to reduce environmental degradation and boost green economic growth, such as investing in energy projects and reduce the dependency on fossil fuels. The findings also suggest that to achieve the sustainable growth and environment, E7 countries must enhance the environment related technology innovations.