Understanding the Role of Technology in Asian Economies: The Environmental Impact of Remittances and Economic Complexity

Abstract

In recent years, scholars have determined various determinants of environmental degradation using the panel and time-series studies. However, technological innovations (TI) and remittances, among the financial system’s essential components, are relatively ignored. In addition, nations’ economic progress and environmental performance also depend upon the nature of their economic structure. This empirical research investigates the effects of TI, remittances and economic complexity (EC) on CO2 controlling economic growth and trade openness (TR) in the selected 15 Asian nations. The study collected panel data of 15 Asian countries from 1990 to 2019 and employed the panel quantile regression and augmented mean group methods to unveil the impacts of variables on CO2 emissions. The empirical findings established that remittances are negatively linked with CO2 emissions. Similarly, EC reduces CO2 emissions in the context of Asian countries. In addition, EC and remittances Granger cause CO2 emissions. These findings indicate that remittances and EC positively contribute to environmental quality in Asian countries. Conversely, TI, economic growth, and TR intensify CO2 emissions in Asian countries. Finally, the study recommended policies to enhance remittances and EC in Asian countries to curb environmental degradation.