Brown vs Green Energy Sources and Resource Productivity: The Role of Human Capital and Technology Transfer in Developing Economies

Abstract

AbstractThis study determined the impacts of non-renewable and renewable energy consumption on natural resource productivity alongside human capital and technology transfer roles for 40 selected developing economies. The study relied on a dataset sourced between 1991 and 2021. The study applied the novel method of moments quantile regression (MMQREG) procedure for the analyses while ensuring inferential robustness through the fully modified ordinary least squares (FMOLS), dynamic OLS (DOLS), and Driscoll-Kraay (D-K) methods. Empirically, the study revealed that an increase in brown energy consumption exhausted resource productivity from the lower to the upper quantiles. In contrast, green energy utilisation enhanced resource productivity from the lower to the higher quantiles. Also, while human capital adversely affected resource productivity for both energy means, technology transfer positively impacted it from the lower to the upper quantiles. Likewise, inferences from the DOLS, FMOLS, and D-K techniques revealed similar findings. However, despite non-renewable energy being the dominant means of energy in these developing economies, the size of its adverse impact on resource productivity falls short of the increasing effect of renewable energy across all quantiles. Also, the magnitude of the negative impact of human capital on resource productivity is marginally more substantial with non-renewable energy. In contrast, the robustness of the enhancing impact of technology transfer is slightly more with renewable energy.JEL Classification:O47, Q2, Q32.