The Impact of World Uncertainty, Environmental Policy Stringency, and Technological Innovation on Environmental Sustainability: Evidence from High-Income Countries

Industrialization and economic growth in high-income countries have considerably increased consumption-based CO 2 emissions (CCO 2 ), adversely affecting environmental sustainability and contributing to climate change. This study assesses the impacts of Environmental Policy Stringency (EPS), World Uncertainty (WU), and Technological Innovation (TI) on environmental sustainability, aiming to guide the development of balanced policies that foster growth. Utilizing panel data from 1990 to 2021 across high-income countries, we employed the Method of Moments Quantile Regression (MMQR) to capture the varying effects of these factors at different levels of CCO 2 emissions. Our findings reveal that WU consistently and significantly reduces CCO 2 emissions across all quantiles, while the effects of EPS are minimal and largely insignificant. Similarly, TI demonstrates a weak and statistically non-significant impact, indicating that technological advancements alone are insufficient for meaningful improvements in environmental sustainability. Importantly, renewable energy consumption (REC) significantly lowers CCO 2 emissions, while economic growth (GDP) has a strong tendency to increase emissions, particularly at lower quantiles. These insights highlight the necessity for high-income countries to adopt comprehensive fiscal and environmental policies to mitigate emissions and enhance sustainability, with a focus on prioritizing renewable energy, encouraging innovation, and strengthening policy measures to achieve long-term ecological objectives.