The synergistic roles of green openness and economic complexity in environmental sustainability of Europe's largest economy: Implications for technology-intensive and environmentally friendly products

Abstract

The degrowth approach posits the idea that sustainable development and economic expansion are mutually exclusive. Conversely, it is believed that international trade within a complex economic system can help distribute green products to simultaneously ensure economic expansion and sustainable development. For this reason, the dynamic ARDL simulations technique was adopted to analyze the German economy's data from 2000 to 2020 toward determining the specific and interactive ecological implications of international green openness and economic complexity in Europe's largest economy. We discovered that green openness and economic complexity each have desirable impacts on ecofootprint, and their interaction further confirms a strong ecological-enhancing synergistic effect. The presence of the EKC phenomenon was also upheld from the analysis while clean energy exerts a positive impact on Germany's environmental quality level. The study further posits that a faster shift into the manufacture of technology-intensive and environmentally friendly products is possible for nations that invest in strengthening their internal technological skills to curb ecological harm. It is therefore advocated that even if the manufacturing of green items is not optimally done domestically, the special opportunities presented by international trade in the distribution of green products should always be leveraged to foster environmental sustainability.