Innovation-Led Environmental Sustainability in Vietnam—Towards a Green Future

Abstract

The motivation of the study is to assess the role of education, technological innovation, financial innovation, and clean energy consumption trade openness on environmental sustainability in Vietnam. The study implemented symmetric and asymmetric frameworks to document explanatory variables’ coefficients on ES. Study findings suggest that education, innovation, and clean energy prompt environmental sustainability by lowering the carbon emission and ecological imbalance in the long and short run. Regarding the asymmetric assessment, the standard Wald test confirmed the asymmetric association in the long run and short run. For directional causality, the study implemented the TY–Fourier causality test. It revealed bidirectional causality between technological innovation and environmental sustainability. In contrast, unidirectional causality ran from education to ES and FDI to ES. Policy recommendations have been derived from the empirical findings of both symmetric and asymmetric investigations. These recommendations highlight the importance of prioritizing investments in education and technological innovation to enhance environmental sustainability. Moreover, promoting clean energy technologies and encouraging financial innovations can serve as additional catalysts for advancing sustainable practices. The implications of the policy as mentioned above offers valuable insights for policymakers and stakeholders in their endeavor to develop strategies to achieve environmental sustainability in Vietnam. While the findings contribute to our understanding of the determinants of ES in Vietnam, it is important to note that the study’s scope is limited to the examined determinants. Other factors not included in the study may also have a significant role.