Financial Development, Renewable Energy, and Environmental Sustainability: Evidence from Emerging Asian Economies
DOI:
https://doi.org/10.47067/ramss.v8i4.592Keywords:
Financial Development, Renewable Energy, Fixed effect, Random Effect, Hausman test, Environmental SustainabilityAbstract
This study investigates the effects of financial development and renewable energy consumption on environmental quality in the Emerging Asia group over the period 1999–2023 using panel data. Carbon dioxide emissions are used as a proxy for environmental quality, while broad money represents financial development. Renewable energy consumption, economic growth, and urbanization are included as control variables. Fixed-effects and random-effects models are estimated, and the Hausman test indicates that the random-effects specification is more appropriate. The results show that financial development, economic growth, and urbanization significantly increase carbon emissions, whereas renewable energy consumption improves environmental quality. These findings highlight the importance of promoting green finance and renewable energy policies to achieve sustainable environmental outcomes in Emerging Asian economies.
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