Towards achieving energy transition goal: How do green financial policy, environmental tax, economic complexity, and globalization matter?

Abstract

The severe environmental degradation and huge energy demand for economic growth necessitate an urgent shift to a cleaner and more efficient energy system. Using data from 32 high-income countries from 2000 to 2020, the study highlights the important roles of green financial policy, environmental tax, economic complexity, and globalization in the energy transition. Green financial policy, environmental tax, and globalization are found to exert beneficial impacts at the selected quantiles of the energy transition distribution. Meanwhile, the quantile regression reveals a U-shaped impact of economic complexity in the first half distribution of the energy transition while an inverted U-shaped linkage is discovered in the second half distribution. This paper is unique in the intention of studying the varying co-benefits of four important factors, which provide valuable insights into the existing literature on the finance-socioeconomic-energy nexus. They facilitate the design and implementation of relevant schemes leading to the accomplishment of environmental sustainable goals.