Financial resources and renewable energy nexus: a holistic perspective

Abstract

Purpose This study aims to explore the association among financial resources, renewable energy, environmental degradation and technological innovation in BRICS economies. Design/methodology/approach To estimate the long-run impacts between these variables, the AMG method of estimation, which incorporates cross-sectional reliance and slope homogeneity, is adopted in this research. Findings According to the empirical findings, the long-run coefficients of environmental degradation and technological innovation show a statistically significant and negative impact on renewable sources of energy. Furthermore, a 1% increase in environmental degradation reduces 0.32% of renewable sources of energy in BRICS economies. Whereas only the coefficient of GDP shows a positive and statistically significant impact on renewable sources of energy, which demonstrates that a 1% increase in economic growth causes a 0.02% incline in renewable sources of energy. Therefore, strong policy recommendations are provided to encourage green energy utilization in these economies. Originality/value The majority of the participating nations have inexpensive labor and an abundance of resources from nature, which strengthens their appeal. Given that population growth is still quite conservative, this presents a chance for GDP per capita to expand significantly.