Do natural resources ensure energy efficiency? A novel paradigm of resources-efficiency nexus for sustainable development

Abstract

There is been ample discussion on the resource-growth and resource-finance nexus in almost every country but the resource-energy paradigm is lacking in developed and developing economies. Henceforth, this research inspects the link between natural resources and energy efficiency in the USA from 1985 to 2021. To avoid biases in the outputs, the research also included the role of economic growth (GDP) and renewable energy(REC). The research utilized an updated time series data sample and also employed relevant approaches which comprise DF-GLS for unit root determination, the Bayer-Hanck test for equilibrium, and the novel MMQR as the primary approach. For robustness tests, the research included parametric tests such as FMOLS, DOLS, CCR, and a non-parametric approach which is BSQR for validity. The results observed that variables are stationary at Difference D(1) and long-term equilibrium has been found. Moreover, the main outcomes disclose that natural resources have an asymmetric relationship where the forest rents present a resource curse while mineral rents have blessings for energy efficiency in the USA across all quantiles. Moreover, GDP and REC substantially improve energy efficiency in the USA. The robustness protocols exhibit that outcomes are analogous to the main outcomes and are therefore, valid, reliable, and robust. Established on the estimates, the research provides relevant policy suggestions to policymakers concerning the sustainable use of natural resources, economic growth, and renewable energy related to energy efficiency.