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Asymmetric macroeconomic determinants of renewable energy consumption: do financial institutions and ICT trade matter?

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Abstract

This study aims to examine the asymmetric impact of financial institutions and information and communication technologies (ICT) trade on renewable energy demand in BRICS economies by using the cross-sectionally augmented nonlinear autoregressive distributed lag model. The asymmetric estimates of the financial institutions index confirm that a positive shock increases renewable energy consumption, and a negative shock reduces renewable energy consumption in BRICS economies. Similarly, the long-run asymmetric estimates attached to ICT trade are positively significant, confirming that a positive shock increases renewable energy consumption and a negative shock hurts renewable energy consumption. As far as country-wise estimates are concerned, the long-run asymmetric estimates of financial institutions are significant in Brazil, Russia, China, and South Africa. Similarly, the asymmetric estimates attached to ICT trade are significant in Russia, China, India, and South Africa. The results are asymmetric in nature, implying that negative and positive shocks have different effects on renewable energy consumption. Therefore, policymakers should consider both negative and positive shocks in financial institutions and ICT trade while devising policies regarding environmental sustainability and renewable energy consumption.

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Data availability

The datasets used and/or analyzed during the current study are available from the corresponding author on reasonable request.

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Authors and Affiliations

  1. Business School, Guilin University of Electronic Technology, Guilin, Guangxi, China

    Lei Wang

  2. Institute of Intelligent Machines, HFIPS, Chinese Academy of Sciences, Hefei, 230031, China

    Yingliang Huang

  3. Institute of Business Management Sciences, University of Agriculture, Faisalabad, Pakistan

    Abdul Ghafoor & Muhammad Hafeez

  4. Department of Mathematical Methods in Economics, Tashkent State University of Economics, Tashkent, Uzbekistan

    Raufhon Salahodjaev

Authors
  1. Lei Wang
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  2. Yingliang Huang
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  3. Abdul Ghafoor
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  4. Muhammad Hafeez
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  5. Raufhon Salahodjaev
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Contributions

This idea was given by LW. LW, YH, and AG analyzed the data and wrote the complete paper, while MH, RS, and YH read and approved the final version.

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Correspondence to Yingliang Huang.

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Wang, L., Huang, Y., Ghafoor, A. et al. Asymmetric macroeconomic determinants of renewable energy consumption: do financial institutions and ICT trade matter?. Environ Sci Pollut Res 30, 9841–9851 (2023). https://doi.org/10.1007/s11356-022-22816-0

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  • DOI: https://doi.org/10.1007/s11356-022-22816-0

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