Environmental sustainability in South Africa: Understanding the criticality of economic policy uncertainty, fiscal decentralization, and green innovation

Abstract

South Africa, like most developing nations, is confronted with choosing between the need to advance their economy and the need to protect the environment. The United Nations Sustainable Development Goals 11, 12 & 13) provide a strong foundation for this investigation. To this end, the current research investigates the combined impacts of economic policy uncertainty, fiscal decentralization, and green innovation on environmental sustainability for the instance of South Africa with yearly frequency data from 1960 to 2020. The current research leverages on dynamic ordinary least squares, fully modified ordinary least squares, and canonical cointegration regression. The Maki cointegration test shows how the variables being evaluated have an equilibrium connection across the time period under review.Empirical findings support the environmental Kuznets curve (EKC) framework. These findings imply that, in the first stages of economic expansion, ecological environment is being sacrificed for economic progress (scale stage). Based on the EKC hypothesis, long-term quadratic economic growth reduces emissions by 0.162% whereas a 1% rise in economic growth increases emissions by 0.791%. Similar to this, long-term economic globalization and economic policy uncertainty impair ecological sustainability, whereas long-term fiscal decentralization and green innovation raise it in South Africa. These results have broad environmental repercussions. The present investigation supported environmental stick measures and investment in initiatives on a fundamental change from fossil-fuel energy consumption base to renewables.The final portion highlights further insights.

Revisiting the nexus between fiscal decentralization and CO2 emissions in South Africa: fresh policy insights

“…Isik et al (2020) validated this evidence in their analysis of G7 nations from 1995 to 2015 for France, but EKC was not valid in the US, the UK, Japan, Italy, Germany, and Canada. Additionally, according to Udeagha and Muchapondwa (2022b), EKC was found in South Africa from 1960 to 2020. Our evidence further supports those of Murshed (2021) for six South Asian economies.…”

Achieving green environment in Brazil, Russia, India, China, and South Africa economies: Do composite risk index, green innovation, and environmental policy stringency matter?

“…Additionally, their actual R&D investment rose by 3.8%. In a similar vein, public R&D spending was 1.3%, whereas private R&D spending was over 28% (Udeagha & Muchapondwa, 2022a, 2022b). Therefore, this study is crucial for the BRICS nations under examination.…”

“…EPS shows the potential and successes in the implementation of environmental rules, and explains how economies are motivated by ecological goals in relation to the average standards of nations when implementing such regulations (Udeagha & Muchapondwa, 2022b). Kongbuamai et al (2021) demonstrated that EPS plays a major role in accomplishing sustainable development goals (SDGs) while preserving ecological quality.…”

“…Unlike other studies, this study examines the combined impacts of CRI, GINOV, and EPS on environmental quality using data from 1960 to 2020. To fully appreciate the connected problems and comprehend the processes via which this connection occurs in the BRICS region, a close examination of the relationship between CO 2 emissions and these factors is required.2.3 | Relationship between EPS and CO 2 emissionsEPS shows the potential and successes in the implementation of environmental rules, and explains how economies are motivated by ecological goals in relation to the average standards of nations when implementing such regulations(Udeagha & Muchapondwa, 2022b) Kongbuamai et al (2021). demonstrated that EPS plays a major role in accomplishing sustainable development goals (SDGs) while preserving ecological quality.…”

The spillover effects of uncertainty and globalization on environmental quality in India: Evidence from combined cointegration test and augmented ARDL model

“…The most notable finding of the researchers is the distinction between the short and long-term effects of WUI on CO 2 emissions, as economic uncertainty reduces carbon emissions in the short run, allowing for climate improvement. However, in the long run, the influence positively affects CO 2 emissions (Udeagha, M. C. and Muchapondwa, 2022), where economic uncertainty is regarded as a cause of environmental degradation in the study sample. Syed et al (2022) studied the impact of EPU and geopolitical risks (GPR) on CO 2 emissions in BRICST countries from 1990 to 2015.…”