Towards mitigating ecological degradation in G-7 countries: accounting for economic effect dynamics, renewable energy consumption, and innovation

Ojonugwa Usman; Paul Terhemba Iorember; Gylych Jelilov; Abdurrahman Isik; George N Ike; Samuel Asumadu Sarkodie

doi:10.1016/j.heliyon.2021.e08592

Towards mitigating ecological degradation in G-7 countries: accounting for economic effect dynamics, renewable energy consumption, and innovation

Heliyon. 2021 Dec 13;7(12):e08592. doi: 10.1016/j.heliyon.2021.e08592. eCollection 2021 Dec.

Authors

Ojonugwa Usman¹, Paul Terhemba Iorember², Gylych Jelilov², Abdurrahman Isik², George N Ike³, Samuel Asumadu Sarkodie⁴

Affiliations

¹ School of Business Education, Federal College of Education (Technical) Potiskum, Yobe State, Nigeria.
² Department of Economics, Nile University of Nigeria, Nigeria.
³ Department of Economics, Girne American University, Girne, North Cyprus, Via Mersin 10, Turkey.
⁴ Nord University Business School (HHN), Post Box 1490, 8049 Bodø, Norway.

Abstract

The 21^st century economic growth is characterized by extensive production and consumption, which increases anthropogenic emissions. However, reducing emission levels require ecological sustainability through innovation and modern technological consideration. This paper investigated not only renewable energy-driven environmental quality but also captured innovation research investment in renewables within the framework of the environmental Kuznets curve (EKC) model for G-7 countries. The findings confirmed the presence of EKC hypothesis for G-7 countries. In addition, renewable energy and innovation were identified to exert negative effects on ecological footprint. To capture the entire conditional distribution of the ecological footprint, we applied the Method of Moments Quantile Regression with fixed-effects. The results affirmed the negative effects of renewable energy innovation. Besides, their effects were heterogeneous across the quantiles with evidence of diminishing effects from lower to higher quantiles, suggesting that countries with lower levels of ecological footprint are possibly more prone to the environmental deterioration effect of income growth. The results of the causality test support economic growth-induced ecological degradation, growth-induced renewables, and innovation-induced ecological conservation. The results further showed a feedback effect between renewables and ecological footprint, innovation, and income growth as well as innovation and renewables. These findings portend important implications for the realization of carbon-free economies in G-7 countries by 2100.

Keywords: Ecological degradation; Economic effect dynamics; Renewable energy; Renewable research innovations; Sustainable development.