Relationship Between Economic Complexity, Globalization, Energy Sources and Environmental Sustainability

This study investigates the relationship between economic complexity, globalization, energy consumption patterns and CO2 emissions in 12 energy-importing emerging economies from 1996 to 2020. Employing panel data analysis, the autoregressive distributed lag (ARDL) model is utilized. The findings reveal a U-shaped relationship between economic complexity and air pollution, supporting the environmental Kuznets curve (EKC) theory. Renewable energy demonstrates a significant ability to reduce CO2 emissions over the long term, while fossil fuel use exacerbates environmental degradation. Economic globalization is associated with increased CO2 emissions, contradicting expectations. The short-term results align with the long-term findings, highlighting significant country-specific variations. The policy implications highlight the necessity of promoting renewable energy adoption and reducing reliance on fossil fuels. This research contributes to EKC literature by focusing on energy-importing economies, emphasizing the importance of multidimensional analyses in environmental policy formulation. The study underscores the critical role of renewable energy investment and carbon pricing strategies in mitigating environmental degradation while encouraging sustainable development pathways.