Exploring the impacts of entrepreneurship indices on renewable energy mix: A cross-country study

Abstract

This research analyzes the impact of eleven entrepreneurship indicators on renewable energy development across 14 countries from 2002 to 2019. Utilizing Kao's test for variable cointegration and the Panel Fully Modified Ordinary Least Squares (PFMOLS) model, our research highlights financial development's critical role in shifting from traditional to newer renewable energies like wind, solar, and bioenergy. Results indicate that specific entrepreneurship indicators, such as commercial infrastructure, market openness, and entrepreneurship education at the primary level, influence renewable energy types differently. For instance, these factors are favorable for hydropower but negative for wind and solar. Conversely, other indicators exhibited the opposite effects. For instance, Research and Development (R&D) transfer, governmental programs, and internal market dynamics positively impacted wind and solar energy sources but negatively affected hydropower and bioenergy. These findings underscore the multifaceted nature of entrepreneurial activities as a driving force behind the development of renewable energies, which highlights the need to reconsider regulations, support mechanisms, and educational frameworks related to entrepreneurship in alignment with climate change, making our research directly relevant to policymakers and practitioners in the environmental and energy sectors. To align with climate change goals better, the research in this study recommends enhancing financial mechanisms for diverse renewable technologies, revising educational frameworks to embed entrepreneurship focusing on renewable innovation, and adjusting governmental programs to support targeted renewable energies.