Socioeconomic Productive Capacity and Renewable Energy Development: Empirical Insights from BRICS

Abstract

Due to the depletion of fossil fuels, empirics began looking at the factors that might encourage investment in renewable energy. Socioeconomic productivity can encourage renewable energy development by encouraging authorities, businesses, and families to rely more on renewable energy sources. Therefore, this analysis is the first-ever effort to detect the impact of socioeconomic productivity on renewable energy development. We have used the panel ARDL and QARDL to examine the estimates. The results of the panel ARDL model predict that national income, financial development, productive capacity index, human capital, ICT, institutional quality, and structural changes are beneficial for renewable energy development in the long run. In the short run, only financial development, productive capacity index, human capital, and ICT promote renewable energy development. Likewise, the panel QARDL model estimates that the national income, financial development, and productive capacity index promote renewable energy development in the long run. However, in the short run, only the productive capacity index and financial development promote renewable energy development. Therefore, by integrating productive assets, entrepreneurial skills, and industrial connections, policymakers must work to boost the productive socioeconomic potential.