The symmetric and asymmetric impacts of green energy, eco-innovation, and urbanization in explaining low-carbon economy for Pakistan.

ABSTRACT

Over the past three decades, global economic development patterns have considerably affected the natural environment, and economies have endured a plethora of environmental concerns as a result of the negative effects of climate change. Among them, Pakistan is the fifth most vulnerable country, and climate change has harmfully affected the ecological and socio-economic conditions of the country. In this regard, this study aimed to investigate the role of green energy consumption, eco-innovation, and urbanization while explaining the dream of low-carbon economy and environmental sustainability in the context of Pakistan using annual time series dataset spanning from 1990 to 2020. The short-run and long-run associations among explained and explanatory variables were investigated using the symmetric, asymmetric, and quantile autoregressive distributed lag models. The findings of the study demonstrated that low-carbon economy, green energy consumption, ecological innovation, urbanization, GDP per capita, and labor force are cointegrated for the long-term association in symmetric, asymmetric, and quantile autoregressive distributed lag models. Furthermore, green energy consumption and effective eco-innovation are the most important paths to ensure environmental sustainability, while urbanization, GDP per capita, and labor force contribute negatively to the low-carbon economy. The findings of the study provide a policy framework for the development of a comprehensive strategy to promote environmental sustainability in Pakistan by emphasizing green energy consumption, ecological innovation, and controlled urbanization, as well as the incorporation of environment friendly policies into economic development policies.