Environmental concerns of financial inclusion and economic policy uncertainty in the era of globalization: evidence from low & high globalized OECD economies

Abstract

Environmental consequences of financial aspects, policy uncertainties and rapid globalization is the topic of intense debate in present years. However, this study contribute to existing literature in an innovative way. We classified the 33 OECD economies in two group’s lower globalized economies (LGE) and highly globalized economies (HGE), based on their level of globalization. Considering the cross-sectional dependency and slope heterogeneity in the data this study employed the Augmented Mean Group method to estimate the influence of financial inclusion, economic policy uncertainty and globalization on the environment quality of both groups for the period 1996–2019. The results revealed a negative significant impact of financial inclusion, while a positive significant impact of economic policy uncertainty on CO2 emissions in both groups, LGE and HGE. However the globalization estimated to have positive impact on CO2 emission in LGE’s, in HGE’s it is significantly impeding the CO2 emission. The interaction of globalization with financial inclusion and economic policy uncertainty respectively found negative and positive to effect the CO2 in both LGE’s and HGE’s. The study suggests that, LGE’s are need to prepare for economic globalization, move toward adopting energy-efficient technology and promote trade in less-polluting products in order to sustain their environment quality. The outcomes of this study are robust by employing different model specifications.

The prominence of fossil energy resources in ecological sustainability of BRICS: The key role of institutional worth

“…Using carbon dioxide (CO 2 ) emission as a measure of environmental sustainability, numerous studies demonstrate a long-term, unidirectional relationship between CO 2 and primary energy consumption (Caglar et al, 2022;Kanat et al, 2022;Ullah et al, 2022d). Global environmental authorities and prominent environmentalists have identified energy usage as the primary source of environmental contamination (Ullah et al, 2022b). Even so, industrialized nations continue to consume energy and degrade the atmosphere; however, they are willing to accept a carbon price and support the use of renewable energy (Rafique et al, 2021).…”

“…Likewise, Arminen and Menegaki (2019) found no correlation between high-income countries' energy usage and CO 2 emissions. According to Ullah et al (2022b)'s analysis, the usage of fossil fuels is the primary cause of Vietnam's rising CO 2 emissions. They also advocate switching from fossil fuels to renewable alternatives to improve environmental sustainability.…”

A step towards green economic policy framework: role of renewable energy and climate risk for green economic recovery

“…Many researchers think there has been a causal link between financial inclusion and economic growth in recent years (Gyimah et al 2022;Razak and Asutay 2022;Ullah et al 2022) and that the relationship between financial inclusion and economic growth is economic growth. It is a motivating factor.…”

Environmental sustainability in developing countries: Understanding the criticality of financial inclusion and globalization

“…On the other hand, a developed financial system may affect the environment by promoting industrial and manufacturing operations with cheap funding, resulting in increased CO 2 emissions. Similarly, FI encourages individual customers to adopt energy-efficient power sources as examined (Ullah et al, 2022).…”