Role of Corruption and Governance Quality on Green Electricity Transition: Learning Through the Lens of Economic Complexity and Sustainability

Abstract

The transition towards green and clean energy sources is the need of the day and a key target for several economies across the globe. Besides, emerging economies also aim to minimize fossil fuel dependence, promoting the adoption of green electricity. However, several obstacles, including governance, corruption and economic-related issues, are forthcoming in attaining sustainability in the context of green energy. This research examines seven emerging economies from 1990 to 2020. The study uses novel panel diagnostic assessment approaches, which validate the slope heterogeneity and cross-sectional dependence and confirm the cointegration between the study variables. Employing the method of moments quantile regression, this research concludes that corruption and governance quality adversely influence the transition to green electricity. On the other hand, the influence of economic complexity, research and development expenditures and per capita GDP is positive and significant. These results are robust as validated by estimators such as mean group and fully modified ordinary least squares. Furthermore, a twoway Granger causality exists between regressors and green energy transition, which allows this research to offer appropriate policy implications. This study recommends improving institutions, strengthening bureaucracy, enhancing accountability and investing in research and development, green technologies and human capital to encourage green energy transition.