The impact of domestic material consumption and energy mix on socioeconomic indicators—A global analysis from 1990 to 2022

Understanding the relationship between economic growth, resource consumption, and social development is crucial for sustainable policy-making. While economic expansion is often linked to improved well-being, its effects depend on material consumption patterns and energy dependency. This study aims to examine how domestic material consumption (DMC) and energy structure influence human development, particularly across different economic contexts. Using a panel data approach, the research applies econometric models to analyze the impact of DMC and energy dependency on social indicators. Findings indicate that excessive DMC can hinder sustainable progress, while a higher share of renewable energy contributes to long-term social development and economic stability. The study highlights the need for resource-efficient policies and energy diversification, contributing to the literature on sustainable growth and development strategies. • Highlight 1 – DMC and Social Development . Results from the research depict that high DMC is normally associated with slowing up the improvement of HDI, especially in developing countries, since environmental degradation impinges negatively on human well-being. • Highlight 2 – Renewable Energy's Impact on GDP While renewable energy contributes to the growth of GDP, its direct contribution to indicators of social development, like HDI, is very limited in the short run. It also has a potential to be useful in the long term for improving social development, provided it comes along with strong supportive policy reforms. • Highlight 3 – Economic Growth and Social Equity What this implies is that economic growth affects social development differently across countries; whereas it would have more benefits in developed countries because of good governance and other institutions, in underdeveloped countries, because of inequalities and weak institutional capacity, it benefits them little. • Highlight 4 – Fossil Fuel Dependence and Inflation Somewhat against perhaps most expectations, it finds that fossil fuel-dependent economies do not exhibit significantly higher inflation rates following economic shocks-like those experienced during the 2008 financial crisis-and thus inflation control is more related to fiscal policy than dependence on an energy source. • Highlight 5 – Sustainable Resource Management: Present research underlines that approaches of sustainable resources management, especially for the high-DMC, are inevitable for further social development and a dependence of the world economy from the transition to renewable sources concerning long-term sustainability.