Drivers of Sustainable Green Finance: Country's Level Risk and Trade Perspective for OECD Countries

Rong W., DESTEK M. A., Chen W., Albahooth B., Khan Z.

JOURNAL OF ENVIRONMENT & DEVELOPMENT, vol.33, no.1, pp.125-148, 2024 (SSCI) identifier identifier

  • Nəşrin Növü: Article / Article
  • Cild: 33 Say: 1
  • Nəşr tarixi: 2024
  • Doi nömrəsi: 10.1177/10704965231217046
  • jurnalın adı: JOURNAL OF ENVIRONMENT & DEVELOPMENT
  • Jurnalın baxıldığı indekslər: Social Sciences Citation Index (SSCI), Scopus, Academic Search Premier, IBZ Online, International Bibliography of Social Sciences, ABI/INFORM, Aerospace Database, Agricultural & Environmental Science Database, Aquatic Science & Fisheries Abstracts (ASFA), Business Source Elite, Business Source Premier, CAB Abstracts, Communication Abstracts, EconLit, Environment Index, Geobase, Greenfile, Index Islamicus, Metadex, PAIS International, Political Science Complete, Pollution Abstracts, Public Affairs Index, Social services abstracts, Sociological abstracts, Veterinary Science Database, vLex, Worldwide Political Science Abstracts, Civil Engineering Abstracts
  • Səhifə sayı: pp.125-148
  • Adres: Yox

Qısa məlumat

In contemporary times, developed economies are adopting environmentally friendly initiatives such as green finance and energy efficiency. However, the factors affecting energy efficiency are widely explored, and green finance remains overlooked in the empirical literature. The present research examines the drivers of sustainable green finance in OECD economies during 2004-2021. The study uses several panel diagnostic tests and validates the mixed integration order of the variables. Still, the long-run equilibrium relationship is valid between financial inclusion, energy efficiency, human capital, foreign trade, composite risk, and green finance. Using panel autoregressive distributed lag model, the study found that financial inclusion, energy efficiency, foreign trade, and composite risk significantly improve green finance in the long run. However, only energy efficiency is effective in the short run. On the other hand, human capital exhibits a significant adverse influence on green finance. The long-run results are robust due to the significant estimates offered by panel dynamic ordinary least square. Besides, there exist one-way and two-way causal associations between variables. The study recommends improving the financial sector performance to enhance financial inclusivity, increase investment in the energy efficiency sector, and encourage trade in environmentally friendly initiatives.