The role of financial development, natural resources, and technology in determining green energy: New findings from the N‐11 countries

Abstract

In recent years, there has been a growing global emphasis on transitioning to renewable energy sources to mitigate the effects of climate change and promote sustainable development. The role of financial development, natural resources, and technology in determining the advancement of green energy has been a subject of ongoing research. This study examines the impact of financial development, natural resources, and technology on green energy development in N‐11 countries between 1990 and 2022, using economic growth and education as control variables. The empirical estimations are based on cross‐section dependence, testing for slope heterogeneity, second‐generation panel unit root tests, LM‐Bootstrap cointegration tests, fully modified ordinary least squares, and dynamic ordinary least squares. A 1% increase in natural resources is associated with a 0.0615% increase in the adoption of green energy. A 1% increase in education leads to a statistically significant increase of 1.0734% in the adoption of green energy financial development enables the deployment of renewable energy sources and access to financial resources. Natural resources determine the types of renewable energy technologies that are prioritized. Technological advancements drive the growth of renewable energy technologies and facilitate their integration into the energy mix. By analyzing the findings of recent studies on the N‐11 countries, we can gain valuable insights into the importance of these factors in advancing green energy and achieving sustainable energy development.