Energy consumption and environmental deterioration: the moderating role of human capital in the Vise grad countries.

Abstract

Abstract The affiliation between energy consumption (ENC) and economic progress (ECP) has a significant environmental concern. The role of human capital (HUC) in lessening the depletion of the natural environment has been extensively researched. However, as a moderating variable, the affiliation between energy consumption and environmental deterioration (EVD) is novel in the literature. This study explores economic progress, environmental taxes (ENT), urbanization (URB), and trade openness (TRO) in the Visegrad Four nations (V4): Poland, Hungary, Slovakia, and the Czech Republic, using data from the WDI and OECD databases from 1994 to 2021. The second-generational panel unit root (CIPS and CADF) was employed for series stationarity. Pedroni and Westerlund's cointegration estimations were used to validate the series' long-term affiliation. The investigation applied the common correlated mean group (CCMG), augmented mean group (AMG), and fully modified ordinary least squares (FMOLS) as a rousted test. The panel causality of Dumitrescu and Hurlin was used to check for causality. The regression results demonstrated that economic progress and energy consumption had a significant favourable link to environmental deterioration, confirming the EKC hypothesis. Similarly, urbanization and openness had a positive nexus with EVD. Environmental taxes and human capital lessen the depletion of ecological quality. The results demonstrated an inverse nexus when human capital was moderated by energy consumption and environmental deterioration. The research suggests that education enrollment and awareness about emissions would lessen the use of non-renewable energy in the Visegrad nations. Finally, the study made several policy recommendations for decision- and policymakers in the V4 regions to combat climate change and increase sustainable energy use.