JOURNAL OF MEHMET AKIF ERSOY UNIVERSITY ECONOMICS AND ADMINISTRATIVE SCIENCES FACULTY, vol.11, no.3, pp.1230-1245, 2024 (ESCI)
This study aimed to estimate the impact of economic globalization on
environmental quality and examine the role of renewable energy
production (REP) in this impact. For this purpose, the annual data of
1976–2021, which is the longest possible period, of the top 5 countries
(Sweden, Switzerland, Norway, France, and Denmark) that show the best
performance according to the Global Green Economy Index 2022 report,
were used. These countries were chosen due to their high performance in
green economy integration; and thus, it was considered that this research
could provide reference results for other countries. In order to achieve this,
the panel smooth transition regression model was applied to the dataset.
This nonlinear approach divides the series into homogeneous regimes
depending on the threshold variable and allows us to make regime-specific
interpretations. As a result, this study, in which REP was defined as the
threshold variable, has shown that there is a two-regime nonlinear
relationship between environmental quality and economic globalization.
According to the findings, economic globalization caused an increase in
environmental degradation in the first regime, which had low REP.
However, this impact was eliminated in the second regime, where REP
was high.