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Policy inference from technological innovation, renewable energy, and financial development for sustainable development goals (SDGs): insight from asymmetric and bootstrap Granger causality approaches

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Abstract

We researched China’s climate and sustainable development goal with relevant and susceptible instruments capable of inducing and mitigating carbon emissions. Amidst the contributor to the global carbon emissions, China is caught in between mitigating its carbon emission and aiming towards placing its national contribution of emissions to the acceptable levels of 1.5 °C and below 2 °C. Following the intricacies surrounding China’s sustainable development as it contains its economic and environmental performance, we adopt China’s data of 1980 and 2018 with different scientific approaches (nonlinear autoregressive distributed lag (NARDL), dynamic ordinary least square test, and bootstrap Granger causality) with different instruments (such as economic growth, financial development, renewable energy, and innovation policies) to research China’s sustainable development. For clear exposition and insight into our findings with policies attached, we draw a conclusion from the outcomes of the mentioned approaches. From NARDL and dynamic ordinary least squares (DOLS), we find that economic growth through economic activities is statistically significant in determining the trend (increase) of carbon emissions in China in both periods (short run and long run). However, other selected instruments (financial, renewable, and innovation policies) tend towards controlling and moderating the carbon emissions in China. Thus, China has good prospects to mitigate its carbon emissions if considered tailoring its policies towards favorable instruments. From bootstrap Granger causality, we find similar inferential results that support previous findings thereby confirming the positive implication of the selected instruments to China’s sustainable development. Hence, the nexus that is established among the selected instruments clearly show the importance of technological innovation and renewable energy in mitigating carbon emissions.

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Authors and Affiliations

  1. Faculty of Economics Administrative and Social Sciences, Istanbul Gelisim University, Istanbul, Turkey

    Edmund Ntom Udemba

  2. Department of Economics, Faculty of Business and Economics, Eastern Mediterranean University, via Mersin 10, Famagusta, North Cyprus, Turkey

    Firat Emir

  3. School of Accounting, Dongbei University of Finance and Economics, Dalian, 116025, Liaoning Province, China

    Nazakat-Ullah Khan

  4. Center for Industrial and Business Organization, Dongbei University of Finance and Economics, Dalian, 116025, Liaoning Province, China

    Sadam Hussain

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  1. Edmund Ntom Udemba
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The paper is written by the four authors named on the title page. Hence, Edmund Ntom Udemba conceived the idea and wrote the abstract with discussion and conclusion, Firat Emir wrote the methodology and estimation, Nazakat-Ullah Khan wrote the introduction, and Sadam Hussain wrote the literature review.

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Highlights of China’s carbon mitigation and sustainable development goals (SDGs)

1. This is a China sustainable development study

2. Assessed with dual analysis of symmetric and asymmetric

3. Target is on impact of technology, financial and renewable energy policy

4. China can mitigate CO2 with renewables, financial and technological innovation

5. Policy is advised to be framed on renewable, financial and innovation

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Udemba, E.N., Emir, F., Khan, NU. et al. Policy inference from technological innovation, renewable energy, and financial development for sustainable development goals (SDGs): insight from asymmetric and bootstrap Granger causality approaches. Environ Sci Pollut Res 29, 59104–59117 (2022). https://doi.org/10.1007/s11356-022-19730-w

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