Social Contribution of Agricultural Sector toward green Economy by using Quantile ARDL Model Approach

Abstract

A green economy is not only a low carbon economy, that ensures adequate production, resource efficiency but also promotes a socially inclusive economy. This means that the economy employs all resources to remove poverty, confirms the availability of food at low cost and other infrastructural facilities, to improve the lifestyle of the inhabitants. The present study considers key social determinants that impact the progression of a green economy in the agricultural sector. Govt expenditures on agriculture, food availability, Foreign Direct Investment (FDI) in agriculture, access to energy, and agricultural Infrastructure, are taken as exogenous variables whereas a green economy Index is developed with 20 variables as endogenous variables. A nonlinear relationship is tested using Panel QARDL for 80 developed and developing countries during 2000-2020 time. ECM is significant and negative at all quantiles as required for the stability of the model. Govt expenditures and FDI are found to be significant and negative in the long run indicating that the expenditures and investment for a green economy need the right direction from govt and private investors not to invest in areas that deplete the natural resources. All exogenous variables are significant at higher quantiles in PQARDL. The study concludes with a policy suggestion that for a socially inclusive and resilient green economy, equal access to energy for smart practices, availability of food for all, are valuable in agricultural sector for moving toward sustainability and a green economy.