The impacts of household social benefits, public expenditure on labour markets, and household financial assets on the renewable energy sector

Abstract

This research analyses the impacts of social benefits to households, public spending on labour markets, and household financial assets on the supply of renewable energy for selected OECD coussntries from 1995 to 2017. It uses a Panel Non-linear ARDL (PNARDL) model to investigate the long- and short-run symmetric relationships between the variables. The results indicate that changes in labour market public spending have significant asymmetric impacts on renewable energy over both time horizons. The findings confirm the importance of current active labour market policies on the energy market. However, the effects of household financial assets on the energy market are not pronounced. Likewise, the results show that positive changes in household social benefits have a negative impact on renewable energy in the short run. Addressing barriers and increasing investment opportunities for households in the renewable energy market can provide effective solutions for overcoming downturns during periods of economic uncertainty, pandemics, and recessions.