Skip to main content
SpringerLink
Log in

Achieving environmental quality in the Mediterranean region: the role of financialization, human capital and energy efficiency

  • Original Paper
  • Published:
Euro-Mediterranean Journal for Environmental Integration Aims and scope Submit manuscript

Abstract

The Sustainable Development Goals (SDGs) of the United Nations include environmental quality as one of the compelling cardinal goals. However, the process of achieving environmental quality requires accessibility to low-cost financial resources, high level of knowledge economy and energy efficiency which previous studies have failed to capture. Therefore, this study provides a fresh insight by capturing the role of financialization, human capital and energy efficiency in addressing the environmental question in the Mediterranean region. The study employs Cross-Sectional Autoregressive Distributed Lag (C-S ARDL) model and panel Dumitrescu-Hurlin causality. The results showed that financial development and economic exacerbate ecological footprint thereby dampening environmental quality in the Mediterranean region, while human capital and energy efficiency enhance environmental quality through a reduction in eological footprint. The study recommends promoting financial instruments that direct capital toward green initiatives, as well as encouraging training and educational initiatives that focused on environmental sciences and sustainable development in order to improve human capital. The study recommends promoting financial instruments that direct capital to green initiatives and discourage capital investment in polluting companies. Enacting laws and incentives that encourage investment in sustainable practices and renewable energy, as well as education and training initiatives focusing on environmental sciences and sustainable development to improve human capital.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Fig. 1

Source: www.worldatlas.com/atlas/infopage/medsea.htm

Fig. 2

Similar content being viewed by others

Data availability

Data are available upon request.

References

  • Abdouli M, Omri A (2021) Exploring the nexus among FDI inflows, environmental quality, human capital, and economic growth in the Mediterranean region. J Knowl Econ 12:788–810

    Article  Google Scholar 

  • Adejumo OO (2020) Environmental quality vs economic growth in a developing economy: complements or conflicts. Environ Sci Pollut Res 27(6):6163–6179

    Article  Google Scholar 

  • Akpanke TA, Deka A, Ozdeser H, Seraj M (2023) The role forest resources, energy efficiency, and renewable energy in promoting environmental quality. Environ Monit Assess 195(9):1071

    Article  Google Scholar 

  • Akram R, Chen F, Khalid F, Ye Z, Majeed MT (2020) Heterogeneous effects of energy efficiency and renewable energy on carbon emissions: evidence from developing countries. J Clean Prod 247:119122

    Article  Google Scholar 

  • Alola AA, Bekun FV, Sarkodie SA (2019) Dynamic impact of trade policy, economic growth, fertility rate, renewable and non-renewable energy consumption on ecological footprint in Europe. Sci Total Environ 685:702–709

    Article  CAS  Google Scholar 

  • Aluko OA, Obalade AA (2020) Financial development and environmental quality in sub-Saharan Africa: Is there a technology effect? Sci Total Environ 747:141515

    Article  CAS  Google Scholar 

  • Asif S, Naqvi A, Ale S, Shah R, Mehdi MA (2020) Revealing empirical association among ecological footprints. Renewable Energy Consumption, Real Income, and Financial Development: A Global Perspective. Environ Sci Pollut Res 24:42830–42849

    Google Scholar 

  • Bandyopadhyay A, Rej S (2021) Can nuclear energy fuel an environmentally sustainable economic growth? Revisiting the EKC hypothesis for India. Environ Sci Pollut Res 28:63065–63086

    Article  Google Scholar 

  • Bekun FV, Alola AA, Sarkodie SA (2019) Toward a sustainable environment: Nexus between CO2 emissions, resource rent, renewable and nonrenewable energy in 16-EU countries. Sci Total Environ 657:1023–1029

    Article  CAS  Google Scholar 

  • Bekun FV, Gyamfi BA, Onifade ST, Agboola MO (2021) Beyond the environmental Kuznets Curve in E7 economies: accounting for the combined impacts of institutional quality and renewables. J Clean Prod 314:127924

    Article  Google Scholar 

  • Bibi F, Jamil M (2021) Testing environment Kuznets curve (EKC) hypothesis in different regions. Environ Sci Pollut Res 28:13581–13594

    Article  CAS  Google Scholar 

  • Çakar ND, Gedikli A, Erdoğan S, Yıldırım DÇ (2021) Exploring the nexus between human capital and environmental degradation: The case of EU countries. J Environ Manage 295:113057

    Article  Google Scholar 

  • Chondrogianni A, Tsalaporta P (2023) Reversing environmental deterioration: the role of human capital in developing countries. Econ Change Restructuring, 1–15.

  • Dai J, Ahmed Z, Alvarado R, Ahmad M (2023) Assessing the nexus between human capital, green energy, and load capacity factor: Policymaking for achieving sustainable development goals. Gondwana Research.

  • Deka A, Bako SY, Ozdeser H, Seraj M (2023) The impact of energy efficiency in reducing environmental degradation: does renewable energy and forest resources matter? Environ Sci Pollut Res 30(37):86957–86972

    Article  Google Scholar 

  • Dilanchiev A, Sharif A, Ayad H, Nuta A C (2024) The interaction between remittance, FDI, renewable energy, and environmental quality: a panel data analysis for the top remittance-receiving countries. Environ Sci Pollut Res 1–15.

  • Dogan E, Inglesi-Lotz R (2020) The impact of economic structure to the environmental Kuznets curve (EKC) hypothesis: evidence from European countries. Environ Sci Pollut Res 27:12717–12724

    Article  Google Scholar 

  • Du Q, Wu N, Zhang F, Lei Y, Saeed A (2022) Impact of financial inclusion and human capital on environmental quality: evidence from emerging economies. Environ Sci Pollut Res 29(22):33033–33045

    Article  Google Scholar 

  • Egbetokun S, Osabuohien E, Akinbobola T, Onanuga OT, Gershon O, Okafor V (2020) Environmental pollution, economic growth and institutional quality: exploring the nexus in Nigeria. Manag Environ Quality 31(1):18–31

    Article  Google Scholar 

  • Elmassah S, Hassanein EA (2022) Can the resource curse for well-being be morphed into a blessing? Investigating the moderating role of environmental quality, governance, and human capital. Sustainability 14(22):15053

    Article  Google Scholar 

  • Fernando Y, Hor WL (2017) Impacts of energy management practices on energy efficiency and carbon emissions reduction: a survey of Malaysian manufacturing firms. Resour Conserv Recycl 126:62–73

    Article  Google Scholar 

  • GFN, Global Footprint Network (2022). https://api.footprintnetwork.org/v1/data/all/2019/EFCpc.

  • Gulaliyev MG, Muradov RS, Hajiyeva LA, Muradova HR, Aghayeva KA, Aliyev ES (2019) Study of human capital development, economic indicators and environmental quality. Ekoloji Dergisi, (107).

  • Guo Y (2021) Financial development and carbon emissions: analyzing the role of financial risk, renewable energy electricity and human capita for China. Discrete Dyn Nat Soc.

  • Hondroyiannis G, Papapetrou E, Tsalaporta P (2022) New insights on the contribution of human capital to environmental degradation: evidence from heterogeneous and cross-correlated countries. Energy Economics 116:106416

    Article  Google Scholar 

  • Ibrahim MD (2023) Efficiency and productivity analysis of innovation, human capital, environmental, and economic sustainability nexus: case of MENA countries. Environ Sci Pollut Res 30(12):34394–34405

    Article  Google Scholar 

  • IMF, International Monetary Fund (2022). Financial Development. https://data.world/imf/financial-development-fd

  • Iorember PT, Yusoff NYM (2023) Income–environmental nexus in Africa: the integrating role of renewable energy transition and governance quality. Afr Dev Rev 35(4):376–389

    Article  Google Scholar 

  • Iorember PT, Goshit GG, Dabwor DT (2020) Testing the nexus between renewable energy consumption and environmental quality in Nigeria: the role of broad-based financial development. Afr Dev Rev 32(2):163–175

    Article  Google Scholar 

  • Iorember PT, Jelilov G, Usman O, Işık A, Celik B (2021) The influence of renewable energy use, human capital, and trade on environmental quality in South Africa: multiple structural breaks cointegration approach. Environ Sci Pollut Res 28:13162–13174

    Article  Google Scholar 

  • Iorember PT, Gbaka S, Jelilov G, Alymkulova N, Usman O (2022b) Impact of international trade, energy consumption and income on environmental degradation in Africa’s OPEC member countries. Afr Dev Rev 2022:1–13

    Google Scholar 

  • Iorember PT, Iormom B, Jato TP, Abbas J (2022b) Understanding the bearable link between ecology and health outcomes: the criticality of human capital development and energy use. Heliyon, 8(12).

  • Javid M, Khan M (2020) Energy efficiency and underlying carbon emission trends. Environ Sci Pollut Res 27(3):3224–3236

    Article  CAS  Google Scholar 

  • Kim D, Go S (2020) Human capital and environmental sustainability. Sustainability 12(11):4736

    Article  Google Scholar 

  • Li Q, Sharif A, Razzaq A, Yu Y (2022) Do climate technology, financialization, and sustainable finance impede environmental challenges? Evidence from G10 economies. Technol Forecast Soc Chang 185:122095

    Article  Google Scholar 

  • Liu X, Razzaq A, Shahzad M, Irfan M (2022) Technological changes, financial development and ecological consequences: a comparative study of developed and developing economies. Technol Forecast Soc Chang 184:122004

    Article  Google Scholar 

  • Majeed MT, Asghar N (2021) Trade, energy consumption, economic growth, and environmental quality: an empirical evidence from D-8 and G-7 countries. Environ Sci Pollut Res 28(43):61302–61316

    Article  CAS  Google Scholar 

  • Mingxing L, Ashraf MS, Zhiqiang M, Ashraf RU, Usman M, Khan I (2023) Adaptation to globalization in renewable energy sources: environmental implications of financial development and human capital in China. Front Environ Sci 10:1060559

    Article  Google Scholar 

  • Musa MS, Jelilov G, Iorember PT, Usman O (2021) Effects of tourism, financial development, and renewable energy on environmental performance in EU-28: Does institutional quality matter? Environ Sci Pollut Res 28(38):53328–53339

    Article  Google Scholar 

  • Nuta FM, Sharafat A, Abban OJ, Khan I, Irfan M, Nuţa AC, Asghar M (2024) The relationship among urbanization, economic growth, renewable energy consumption, and environmental degradation: a comparative view of European and Asian emerging economies. Gondwana Res, 128, 325–339.

  • Ozili PK, Iorember PT (2023) Financial stability and sustainable development. Int J Finance Econ.

  • Papamichael I, Voukkali I, Zorpas AA (2022) Mediterranean: main environmental issues and concerns. Euro-Mediterranean J Environ Integration 7:477–481

    Article  Google Scholar 

  • Pata UK, Caglar AE, Kartal MT, Depren SK (2023) Evaluation of the role of clean energy technologies, human capital, urbanization, and income on the environmental quality in the United States. J Clean Prod 402:136802

    Article  Google Scholar 

  • PWT, Penn World Table 9.1 (2022). The database | Penn World Table | Productivity | University of Groningen. https://www.rug.nl/ggdc/productivity/.

  • Saidi K, Rahman MM (2021) The link between environmental quality, economic growth, and energy use: new evidence from five OPEC countries. Environ Syst Decisions 41:3–20

    Article  Google Scholar 

  • Shahbaz M, Nuta AC, Mishra P, Ayad H (2023) The impact of informality and institutional quality on environmental footprint: The case of emerging economies in a comparative approach. J Environ Manage 348:119325

    Article  Google Scholar 

  • Sharma V, Dhamija A, Haseeb M, Khosla S, Tamang S, Sharma U (2023) Transitioning towards a sustainable environment: the dynamic nexus between economic complexity index, technological development and human capital with environmental quality in India. Environ Sci Pollut Res 30(37):87049–87070

    Article  Google Scholar 

  • Shokoohi Z, Dehbidi NK, Tarazkar MH (2022) Energy intensity, economic growth and environmental quality in populous Middle East countries. Energy 239:122164

    Article  CAS  Google Scholar 

  • Sibanda K, Gonese D, Garidzirai R (2023) Human capital and environmental sustainability nexus in selected SADC countries. Resources 12(4):52

    Article  Google Scholar 

  • Tenaw D, Beyene AD (2021) Environmental sustainability and economic development in sub-Saharan Africa: a modified EKC hypothesis. Renew Sustain Energy Rev 143:110897

    Article  Google Scholar 

  • Ünal H, Aktuğ M (2022) The impact of human capital and bio-capacity on the environmental quality: evidence from G20 countries. Environ Sci Pollut Res 29(30):45635–45645

    Article  Google Scholar 

  • Usman O (2023) Renewable energy and CO2 emissions in G7 countries: Does the level of expenditure on green energy technologies matter? Environ Sci Pollut Res 30(10):26050–26062

    Article  CAS  Google Scholar 

  • Usman M, Jahanger A (2021) Heterogeneous effects of remittances and institutional quality in reducing environmental deficit in the presence of EKC hypothesis: a global study with the application of panel quantile regression. Environ Sci Pollut Res 28(28):37292–37310

    Article  Google Scholar 

  • Usman O, Olanipekun IO, Iorember PT, Abu-Goodman M (2020) Modelling environmental degradation in South Africa: the effects of energy consumption, democracy, and globalization using innovation accounting tests. Environ Sci Pollut Res 27:8334–8349

    Article  Google Scholar 

  • Usman O, Iorember PT, Ozkan O, Alola AA (2024) Dampening energy security-related uncertainties in the United States: The role of green energy-technology investment and operation of transnational corporations. Energy 289:130006

    Article  Google Scholar 

  • Wang Q, Sun Z, Guo J, Li R (2023) The more effective option to combat environmental degradation: Energy efficiency vs. renewable energy vs. natural gas?. Energy 283: 128512.

  • WDI, World development indicators (2022). https://databank.worldbank.org/source/world-development-indicators

  • Wenlong Z, Tien NH, Sibghatullah A, Asih D, Soelton M, Ramli Y (2023) Impact of energy efficiency, technology innovation, institutional quality, and trade openness on greenhouse gas emissions in ten Asian economies. Environ Sci Pollut Res 30(15):43024–43039

    Article  Google Scholar 

  • Westerlund J (2007) Testing for error correction in panel data. Oxford Bull Econ Stat 69:709–748

    Article  Google Scholar 

  • Zhang YJ, Sun YF, Huang J (2018) Energy efficiency, carbon emission performance, and technology gaps: evidence from CDM project investment. Energy Policy 115:119–130

    Article  Google Scholar 

  • Zhao S, Hafeez M, Faisal CMN (2022) Does ICT diffusion lead to energy efficiency and environmental sustainability in emerging Asian economies?. Environ Sci Pollut Res 1–10.

  • Zhu M (2023) The role of human capital and environmental protection on the sustainable development goals: new evidences from Chinese economy. Econ Res-Ekonomska Istraživanja 36(1):650–667

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Department of Economics, Nile University of Nigeria, Abuja, Nigeria

    Paul Terhemba Iorember

  2. Epoka University, 1032, Tirana, Albania

    Abdurrahman Isik & Nargiza Alymkulova

Authors
  1. Paul Terhemba Iorember
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Abdurrahman Isik
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. Nargiza Alymkulova
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Paul Terhemba Iorember.

Ethics declarations

Conflict of interest

On behalf of all authors, the corresponding author states that there is no conflict of interest.

Additional information

Responsible Editor: Stefano Falcinelli.

Rights and permissions

Springer Nature or its licensor (e.g. a society or other partner) holds exclusive rights to this article under a publishing agreement with the author(s) or other rightsholder(s); author self-archiving of the accepted manuscript version of this article is solely governed by the terms of such publishing agreement and applicable law.

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Iorember, P.T., Isik, A. & Alymkulova, N. Achieving environmental quality in the Mediterranean region: the role of financialization, human capital and energy efficiency. Euro-Mediterr J Environ Integr (2024). https://doi.org/10.1007/s41207-024-00526-y

Download citation

  • Received:

  • Accepted:

  • Published:

  • DOI: https://doi.org/10.1007/s41207-024-00526-y

Keywords

Search

Navigation