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Green Finances and Industrial Optimization: Pathways to Financial Development and Sustainable Goals in Europe

Author

Listed:
  • Yunze LI

    (School of Advanced International Studies，Johns Hopkins University，555 Pennsylvania Avenue, NW, Washington, D.C., USA.)

  • Yun HAO

    (School of Economics & Management, Beijing Forestry University, Beijing, China. 3332504246@qq.comSchool of Economics & Management, Beijing Forestry University, Beijing, China. 3332504246@qq.com)

  • Abdur RAUF

    (Department of Economics, University of Science & Technology, Bannu, Pakistan.)

  • Sardar Fawad SALEEM

    (Department of Economics, Abbottabad University of Science & Technology, Abbottabad, Pakistan.)

  • Marioara IORDAN

    (Institute for Economic Forecasting, Romanian Academy, Bucharest, Romania)

Abstract

Europe has initiated a phase characterized by heightened ecological consciousness, facilitating its advancements in pursuing the Sustainable Development Goals (SDGs) and stimulating its financial growth. This research investigates the correlation between green finance, innovation in the industrial sector, and the influence of policy instruments on financial development and attaining the SDGs in countries of the European Union (EU). The findings of the analysis, which utilizes data spanning from 2000 to 2022, demonstrate a substantial positive correlation between green finances and financial growth and SDG fulfillment. In the same way, fiscal stimulus, foreign direct investment (FDI), industrial value addition, and ecological technologies stimulate financial development. In addition, policy instruments such as carbon levies, green laws, and production-related mitigation technology have effectively contributed to advancing SDG objectives. In contrast, the study finds that challenges such as population growth, economic globalization, and traditional energy consumption greatly impede SDG advancement. Notably, the synergistic impacts of innovation combined with clean energy adoption appear critical, potentially transforming SDG outcomes in the EU. Therefore, the EU should support green finance efforts, boost sustainable industrial breakthroughs, and reform its legislative frameworks to mitigate globalization and traditional energy use faster to attain its SDG goals.

Suggested Citation

  • Yunze LI & Yun HAO & Abdur RAUF & Sardar Fawad SALEEM & Marioara IORDAN, 2024. "Green Finances and Industrial Optimization: Pathways to Financial Development and Sustainable Goals in Europe," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(2), pages 111-126, July.
    • Handle: RePEc:rjr:romjef:v::y:2024:i:2:p:111-126
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    More about this item

    Keywords

    Green Finances; Sustainable development goals; policy instruments; industrial output; Environmental Preservation; Green Innovation; Europe;
    All these keywords.

    JEL classification:

    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O44 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Environment and Growth
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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