Do environmental governance, technology innovation and institutions lead to lower resource footprints: An imperative trajectory for sustainability

Abstract

This study explores the asymmetric influence of environmental governance, institutional quality, and technological innovations on consumption-based resource footprints for the selected EU economies. It applies the Method of Moments Quantile Regression (MMQR) for nonlinear association among model variables, while fully modified ordinary least square (FMOLS), dynamic ordinary least square (DOLS), and fixed effect ordinary least square (FE-OLS) for panel heterogeneity from 1990 2019. The preliminary evaluations confirm slope heterogeneity, non-stationarity, and panel cointegration. All three estimators (FMOLS, DOLS, and FE-OLS) support the role of technological innovation, environmental governance, and institutional quality in reducing material footprints. Likewise, the MMQR estimations unveil that environmental governance through policy stringency, technological innovations, and institutional quality substantially decreases material footprints across all quantiles (0.10–0.90). More specifically, the findings show that the role of environmental governance, institutional quality, and technological innovations is more substantial at higher quantiles (3rd to 9th) compared to lower quantiles (1st to 3rd). However, economic growth reflects a substantial and direct source of material footprints in all three ranges of quantiles. The empirical findings suggest that environmental governance is imperative for sustainable resource management.