How Do Resource Efficiency and Environmental Innovation Affect Greenhouse Gas Emissions? Evidence From E-7 Countries

Abstract

This study investigates the determinants of environmental quality in China, India, Russia, Brazil, Mexico, Turkey, and Indonesia (E-7 countries) using annual frequency data from 1990 to 2019. Feasible generalized least squares (FGLS) is used, while panel corrected standard error estimator (PCSE) is employed as a control estimator. The dependent variable representing the environmental quality indicator is greenhouse gas emissions (GHG). Furthermore, the analysis includes following five variables that are assumed to determine environmental quality: (i) resource efficiency; (ii) renewable energy consumption (REC); (iii) growth; (iv) environmental technologies; and (v) energy efficiency. In the estimated model, GHG is used to represent environmental pollution. Conversely, the independent variables are mostly environmentally friendly variables. The results reveal that GDP, REC, and environmental technologies increase GHG emissions, while resource efficiency and energy efficiency have a positive effect on environmental quality. These findings suggest that, in shaping their environmental policies, E-7 countries consider economic growth, environmental protection, and sustainability. The study concludes with a discussion of further policy insights.