Impact of globalization, institutional quality, economic growth, electricity and renewable energy consumption on Carbon Dioxide Emission in OECD countries

This research for the first time examines the influence of the financial development, stock market, globalization, institutional quality, economic growth, electricity, and renewable energy consumption on carbon dioxide emission from 1985 to 2018 in thirty-six (OECD) countries. Cointegrations exist in the used variables based on the examined findings of the Kao, Westerlund, and Pedroni cointegration. Findings of the pooled mean group (PMG) indicate that renewable energy consumption, globalization, and institutional quality assist to reduce the carbon dioxide emission that improve the environment while financial development, stock market, electricity consumption, and economic growth cause to increase the carbon dioxide emission in OECD countries both in the long and in the short run. To reduce carbon dioxide emission, important policy implications are suggested for OECD countries.

Automated summary

This study examines the impact of various factors on carbon dioxide emissions in OECD countries from 1985 to 2018. The findings suggest that renewable energy consumption, globalization, and institutional quality help reduce carbon dioxide emissions, while financial development, stock market performance, electricity consumption, and economic growth contribute to an increase in emissions. Policy implications are proposed to reduce carbon dioxide emissions in OECD countries.