RETRACTED ARTICLE: The non-linear relationship between carbon dioxide emissions, financial development and energy consumption in developing European and Central Asian economies

Abstract

Graphical abstract A sizeable amount of scholarly work has been done on different aspects of financial, economic, and environmental factors. In the present study, the nonlinearity is determined between financial development and carbon dioxide emissions in the long-run and short-run periods. According to the finding, the continued financial development initially increases the carbon dioxide emissions in the short and long run. Simultaneously, the square term of financial development reduces carbon dioxide emissions and proves the inverted U-shaped hypothesis in the short and long periods. The consumption of fossil fuels produces carbon dioxide emissions, leading to environmental pollution. In contrast, renewable energy sources have fostered ecological sustainability by reducing CO 2 emissions in the long and short term. At the same time, a positive response from labor productivity to carbon dioxide emissions causes environmental pollution, while capital formation is not acknowledged as a significant contributor to CO 2 emissions. The Error Correction term has ascertained the reduction in error and convergence of the model from short to long term with a speed of 8% per annum. The study suggested that renewable energy and financial development should be indorsed for environmental preservation in developing European and Central Asian economies. Financial development in favor of low-cost renewables, advancing cleaner production methods, solar paneling, and electrification are a few possible remedies to achieve environmental sustainability in the short-run as well as long-run time frame.

Human Capital, Trade Competitiveness and Environmental Efficiency Convergence Across Asia Pacific Countries

“…Environmental efficiency means simultaneously maximizing good outputs whiles minimizing the use of inputs such as energy, labor, etc., and bad outputs such as CO 2 (Long et al 2017 ). A number of studies have been conducted on environmental efficiency in Asia and other parts of the world including the effect of renewable energy consumption (Jiang et al 2022 ), relationship between carbon dioxide emissions, financial development and energy consumption (Chunyu et al 2021 ), and the correlation between ICT, renewable energy, financial development, and CO2 emissions (Batool et al 2022 ). Previous studies have used the Malmquist Luenberger Productivity Index and Data Envelopment Analysis (DEA) to estimate environmental efficiency in China (Piao et al 2019 ), as well as the SBM Metafrontier to estimate the effect of fertilizer usage intensity on environmental efficiency (Long et al 2018 ).…”

Green energy investment, renewable energy consumption, and carbon neutrality in China

“…Former studies argued that conventional energy consumption increases carbon emissions through the excessive use of fossil fuels in industrialization, urbanization, transportation, and other economic activities. Thus, a positive relationship exists between non-renewable energy consumption and environmental pollution (Khan et al, 2020;Chunyu et al, 2021). Saboori and Sulaiman (2013) empirically analyzed the influence of energy consumption on environmental pollution in Malaysia and found that high consumption of non-renewable energy sources leads to CO 2 emissions.…”

“…It is also called clean energy and includes different forms such as solar, wind, hydro, tidal and geothermal. However, many past studies found that using conventional energy degrades the environment (Chunyu et al, 2021;Fatima et al, 2021). In order to achieve rapid economic growth and compete in the foreign market with more productivity and low cost, developing countries frequently use non-renewable energy sources.…”

Does Degree of Stringency Matter? Revisiting the Pollution Haven Hypothesis in BRICS Countries

“…However, FDI and fossil fuel energy consumption are also significant contributors to the economic growth of developing Asian countries (Huang et al, 2020). Moreover, a non-renewable form of energy taken as fossil fuels significantly increases carbon emissions in European and Central Asian developing economies (Chunyu et al, 2021). In South Asian economies, non-renewable energy contributes to the ecological footprint (Xue et al, 2021).…”