AUTHOR=Fu Qiang , Wang Junwei , Xiang Yonghui , Yasmeen Samina , Zou Bojun 

TITLE=Does financial development and renewable energy consumption impact on environmental quality: A new look at China’s economy

JOURNAL=Frontiers in Psychology

VOLUME=Volume 13 - 2022

YEAR=2022

URL=https://www.frontiersin.org/journals/psychology/articles/10.3389/fpsyg.2022.905270

DOI=10.3389/fpsyg.2022.905270

ISSN=1664-1078

ABSTRACT=To ensure environmental sustainability and a green ecosystem, environmental issues such as climate change have emphasized the need for stricter environmental regulations and the development of green energy resources. Therefore, this study investigates the impact of financial development and renewable energy consumption on environmental quality of China from 2009-2019. Following the application of the ARDL method, this research begins by employing the NARDL (nonlinear autoregressive distributive lag) model in order to analyse the asymmetry in the data that results from the presence of either positive or negative aspects of financial development. The results of the NARDL bound test indicate that the variables are long-term cointegrated. This enables the application of the ARDL methodology. The findings of the ARDL bound test indicate that there is a positive relationship that exists over the long term between financial development, renewable energy consumption trade openness, economic growth, and CO2 emissions. In addition, the error correction model (ECM) confirms that provides evidence that there is, at least in the short run, a connection between CO2 emissions, financial development, economic growth, and energy consumption. Furthermore, according to a dynamic multiplier graph, the positive aspect of financial development has a greater influence on carbon emissions over the course of a longer period of time compared to the shocks associated with a less favorable financial development. According to the findings, there does not appear to be any asymmetry between CO2 emissions and financial development, which lends support to the idea that both the positive and negative aspects of financial development have an equally significant impact.