Asymmetric impacts of green finance development and energy innovation and climate change on United States renewable energy consumption

Résumé fourni par la source

Renewable energy consumption is a critical global imperative for planetary and human well-being. While extant literature has explored various determinants of renewable energy consumption, a significant limitation persists: a predominant focus on linear relationships neglects potential nonlinear dynamics. This research addresses this critical gap by investigating non-linear (asymmetric) effects of key factors- green finance development, energy innovation, and climate change on renewable energy consumption in the United States (US) from 1990 to 2023. Employing the robust econometric methodology of the Non-linear Autoregressive Distributed Lag (NARDL) model, our findings reveal distinct patterns of relationships. It highlights long-run equilibrium relationships among variables, noting that short-term deviations correct over time. This study uncovers pronounced asymmetric impacts of green finance development (GFD) and energy innovation (EI) on renewable energy (RE) consumption. The findings reveal that energy innovation exhibits clear positive and disproportionately negative effects: a positive shock to EI significantly boosts RE consumption, while a negative EI shock results in an adverse effect nearly twice as large. Conversely, the influence of GFD on RE consumption is solely through its downside risk; only negative GFD shocks are found to significantly curtail RE in the long run, whereas positive GFD shocks have statistically insignificant effects. Furthermore, the climate change variable emerges as a pivotal asymmetric positive driver, significantly contributing to renewable energy consumption in the short run. In fact, climate change acts as a short-run catalyst, while its long-run influence is indirect, operating through the financial and technological channels. The research provides novel empirical evidence that innovations in technology and green finance, supported by environmental regulations that mitigate climate change, strengthen efforts to promote renewable energy consumption and decarbonization. These insights offer crucial guidance for policymakers in designing more effective, nuanced climate action frameworks that account for inherent asymmetries in key economic and technological drivers.

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