Assessing the Impact of Green Energy, Taxation, and Financial Flows on Sustainable Development

Abstract

Sustainable development can facilitate reversing the impacts of climate change and environmental degradation. This study investigates the effects of green energy consumption, taxation, and remittance inflow on sustainable development using a panel data set 45 countries over the period 2000 to 2020 and the data was sourced from World Development Indicators (WDI). This paper employs, among others, CS-ARDL dynamic panel estimation methods to form an informed opinion on the mediating effect of economic growth on the association between green energy, taxation, remittances and exports with sustainable development. The findings of this research indicate that green energy and, to a certain extent, exports are important contributors to sustainable development through economic growth. Tax reforms are claimed to support growth but seem to constrain sustainable development while remittances have varied effects as they are known to have positive effects on poverty reduction and financial development yet can have negative impacts on environmental sustainability with the pollution from increased consumption which many economists see as detrimental. The findings of the research for economic development with the slightest negative effect on the atmosphere involve capital flow, tax variation, and the adaptation of green energy regulations. This contributes to the global political debate and yields lessons for governments and institutions all over the world in their efforts to reach the UN sustainable development goals.