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Green finance, fossil fuel efficiency, and sustainable development in OECD

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  • Li, Dongxia

Abstract

This study investigates the effects of eco-friendly finance and fossil fuel efficiency on sustainability in 15 OECD countries from 2005 to 2021. A 1% increase in the Fossil Fuels Efficiency Index improves sustainability by 0.32% in the short term and 0.45% in the long term. Similarly, a 1% rise in green finance enhances sustainability by 0.16% short-term and 0.40% long-term. Negative impacts on sustainability were found from the Energy Security Risk Index, Carbon Footprint, and Economic Growth, while higher Income Levels boost sustainability. Fossil fuel efficiency has a greater effect on sustainability than green finance, highlighting the need to prioritize fossil fuel efficiency. Recommendations include promoting renewable energy, digitizing green finance, customizing marketing strategies, importing energy efficiency technologies, and implementing efficient green tax rates.

Suggested Citation

  • Li, Dongxia, 2024. "Green finance, fossil fuel efficiency, and sustainable development in OECD," Resources Policy, Elsevier, vol. 98(C).
    • Handle: RePEc:eee:jrpoli:v:98:y:2024:i:c:s0301420724006731
    DOI: 10.1016/j.resourpol.2024.105306
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    More about this item

    Keywords

    Eco-friendly finance; Fossil fuels efficiency; Sustainable development; OECD; CD-DL estimation;
    All these keywords.

    JEL classification:

    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • F55 - International Economics - - International Relations, National Security, and International Political Economy - - - International Institutional Arrangements
    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation

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