The governance factor: Mitigating carbon emissions through FDI and financial development in emerging Asian economies.

This study investigates the influence of foreign direct investment (FDI), financial development (FD), and governance on carbon emissions in 15 emerging Asian economies (EAEs) from 2000 to 2021. It aims to assess how successful these nations have been in upholding ecological sustainability while promoting themselves as alternative manufacturing destinations to China and fostering domestic manufacturing through significant financial development. It creates a composite governance quality (GQ) measure and three subdimensions-EcoGov, InstGov, and PolGov-to assess its precise role in influencing the FDI-carbon dioxide (CO2) and FD-CO2 nexuses. Using fully modified ordinary least squares (FMOLS) and dynamic ordinary least squares (DOLS) panel cointegration techniques, this study yielded findings revealing that FDI and FD significantly enhance carbon emissions. The overall GQ significantly moderates the FD-CO2 nexus but fails to moderate FDI's detrimental environmental influence. More specifically, EcoGov significantly moderates FDI's and FD's influence on carbon emissions, whereas InstGov significantly enhances their influence on emissions. In contrast, PolGov is only found to moderate FD's impact on environmental quality since the Government frequently endorses liberal environmental regulations to facilitate FDI-led growth. The findings from this study are robust and carry distinct policy ramifications.

Unbundling the dynamic impact of renewable energy and financial development on real per capita growth in African countries.

Industrialization is considered imperative for growth but energy transitions are paramount for inclusive and green growth especially for a region with low financial sector development to spur investment in renewable energy. This study thus unbundles the interrelation among renewable energy production, financial development, and real per capita growth in 32 selected African countries from the period of 1996 to 2018. These countries are categorized on the basis of oil-rich and non-oil-rich as well as income levels. The study employs Pooled Mean Group, Augmented Mean Group, and Dynamic OLS, and key findings are established. The findings reveal a significantly positive renewable energy-economic growth relationship in all the different groups. Financial development is also found to improve economic performance in all categories except in non-oil-rich African countries. These findings empirically support the need for cleaner energy in the production process to spur inclusive and green growth amidst current global concern for climate change and global warning. This study thus recommends the restructuring of the energy pricing system, provision of long-term finance, adoption of risk mitigation instruments, and improved institutional framework for private participation in renewable energy infrastructural development for growth sustainability in Africa.