Green finance, social inclusion, and sustainable economic growth in OECD member countries

Abstract

AbstractThe importance of fostering a thriving green economy is emphasized as a key strategy for mitigating the threats posed by climate change. This study aims to assess the influence of social inclusion and green finance on the sustainable growth of 31 Organization for Economic Co-operation and Development (OECD) nations between 2010 and 2021. The results obtained using the fully modified OLS (FMOLS) methodology indicate that social factors such as poverty reduction and social inclusion do not impact the green economic prosperity of OECD countries with an industry-focused economic structure. Furthermore, the expansion of green finance markets and the attraction of foreign direct investment with an environmental focus can contribute to the advancement of green development in OECD countries. As a recommendation, it is advisable for OECD nations to place greater emphasis on developing the green digital finance market, exploring blockchain-based green finance solutions, fostering green foreign direct investment, and promoting early warning economic systems.