Dynamic association between ICT, renewable energy, economic complexity and ecological footprint: Is there any difference between E-7 (developing) and G-7 (developed) countries?

Abstract

This empirical research scrutinizes the nexus between information and communication technologies (ICT), renewable energy, economic complexity, human capital, financial development, and ecological footprint for E-7 and G-7 countries over the period from 1995 to 2018. We use four variables (Mobile cellular subscription, fixed broadband subscription, fixed telephone subscription, Internet consumers) for the ICT index prepared through principal component analysis. For empirical analysis, after testing the cross-sectional dependency, this study performs the second-generation method. From the E-7 countries' perspective, the empirical results reveal that ICT, economic complexity, and human capital increase the pollution level while renewable energy significantly reduces it. The estimated financial development coefficient is established to be statistically insignificant. In G-7 countries, all potential factors significantly improve the environmental quality except financial development. Moreover, the interaction between ICT and human capital significantly reduces the ecological footprint level in both panel countries. Therefore, we can observe that there is a wide discrepancy in these countries. The only common thing is that in these countries, bidirectional causality is discovered between ICT, human capital, and ecological footprint. Based on these empirical findings, several practice policy implications for ICT, renewable energy, economic complexity, human capital, financial development, and ecological footprint are discussed.