Role of minerals rent, geopolitical risk, and economic policy uncertainty in achieving green growth: Evidence from novel wavelet quantile correlation approach

Abstract

China is now taking proactive steps to expedite the advancement of green growth (GG) in response to the adverse ecological effects linked to economic expansion and excessive reliance on fossil fuel generation. As a result, researchers frequently analyze the factors that influence GG. The existing literature lacks sufficient analysis of the dynamic influence of minerals rent (MR), geopolitical risk (GPR), and economic policy uncertainty (EPU) on GG. In order to fill this gap, our goal is to analyze the impact of MR, GPR, and EPU on GG in China. To accomplish this objective, we have employed time series data spanning from 1990 to 2021. The empirical results obtained from the recently developed wavelet quantile correlation (WQC) approach demonstrate that MR decreases GG in both the short and long-term, whereas MR increases GG in the medium-run. Subsequently, a higher level of GPR and EPU have a negative effect on GG in both the medium and long-term. The impact of EPU and GPR on GG varies across different quantiles during the short-run. Based on the investigation's findings, we propose several policy recommendations. For instance, revenue from minerals should be allocated to green finance, green technologies, and green energy deployment to escalate GG in China. Similarly, efforts to control EPU and GPR at both national and international levels should be made.