Incorporating Environmental Pollution and Human Development in the Energy-Growth Nexus: A Novel Long Run Investigation for Pakistan

Abstract

Energy acts as a catalyst to boost the human development index (HDI) in a country. However, the overuse of energy leads to environmental deterioration, which is a byproduct of economic development. Due to the utilization of non-renewable energy sources for a long time, worldwide environmental conditions have become alarming. This study investigates the relationship between renewable and non-renewable energy consumption, economic growth, environmental sustainability, and the human development index (HDI) in Pakistan. The investigation incorporates population growth and technology variables to form a multivariate framework. We use a fully modified ordinary least squares (FMOLS) approach to time-series data from 1990–2017. To check the robustness of estimations, we apply the Gregory–Hansen test with a causality test under the VECM to confirm this association’s directions. Our findings confirm that non-renewable energy sources have a positive association with economic growth and CO2 emissions. However, human development, technology, and renewable energy boost economic development and reduce environmental pollution in Pakistan. The co-integration results confirmed the long run connectivity among all variables. The causality outcomes support the bidirectional causality between renewable and non-renewable energy consumption, economic growth, and CO2 emissions, both in the short and long run. These outcomes suggest that Pakistan should focus on energy shifts and gradually increase the share of renewables in its energy mix under the China Pakistan Economic Corridor (CPEC). Additionally, the government should increase human and technological development to enhance economic and environmental sustainability.

Human Development Index, ICT, and Renewable Energy-Growth Nexus for Sustainable Development: A Novel PVAR Analysis

“…Furthermore, the coefficient of usage of renewable energy positively resolves the current level of HDI at a 1% significance level, which specifies that rising renewable energy use will augment the level of HDI. The results are similar to the findings of Abid et al (2020); Sasmaz et al (2020) but dissimilar to the study of Wang et al (2018), who argued that renewable energy does not contribute to the situation of the human development index. As expected, the coefficient value of GDP is an optimistic and momentous effect on the human development index at a 1% level of significance, which shows that these countries need to provide more goods and services to improve the living standards of each country.…”

Decarbonization: examining the role of environmental innovation versus renewable energy use

“…Because panel data usually encounters the problem of cross-sectional dependency due to mutual shocks and unobserved factors among sample units that need to be removed before regression estimation (Pesaran 2007 ; Behera and Dash 2018 ). Similarly, many studies have found a cross-sectional dependence while estimating environmental quality using country-level data (Ahmed et al 2022 ; Abid et al 2020 ; Chen and Lee 2020 ). Our results show that the null hypothesis of “cross-sectional dependency” is strongly rejected at the 1% significance level, indicating a cross-sectional dependency among that sample.…”

“…This paper uses data from 14 developing countries 3 from the Asia region for a period from 1990 to 2018 to examine the effects of environmental technology on the reduction of CO 2 emission after controlling for renewable energy consumption, economic globalization, economic growth, and urbanization. Variables have been selected based on past literature that supported our assumption that decarbonization is possible through green technology innovation, which contributes to environmental sustainability in the economy (Abid et al 2021 , 2020 ; Ahmed et al 2022 ; Lee et al 2022 ).…”

The Relationship between Renewable Energy and Human Development in OECD Countries: A Panel Data Analysis

“…Haiti stands out as a country with low HDI levels but very high levels of renewable energy consumption. Another study on a single country investigated energy consumption, economic growth, environmental sustainability, and the human development index in Pakistan from 1990 to 2015 [33]. Here, it was also demonstrated that renewable energy had a positive impact on human development.…”