An investigation of a nexus between digital economy and society and climate risk: fresh insights from new estimation

Abstract This paper aims to empirically determine the impact of the digital transformation procedure on climate risks. Digitalization is captured by four elements, including digital connectivity (DESI_CONN), digital public services (DESI_DPS) , digital human capital (DESI_HC), and integration of digital technology (DESI_IDT) . We apply various econometric techniques to a database of 24 nations in Europe between 2017 and 2022. Linear effect analysis shows that climate risks generally rise due to digitalization. However, the non-linear analysis points out that environmental risks tend to decrease when digitalization gains a certain level. To reaffirm these findings, we also adopt alternative measurements of digitalization and climate risks. Moreover, we also examine the short-run and long-run impact of digitalization on climate issues, indicating that the influence of digital transformation on the environment is apparent in the long-run period. Our outcomes suggest crucial policy performances for climate risk mitigation.