Digital transformation, financial development and economic growth as determinants of environmental sustainability in ASEAN countries

This study aims to elucidate the short-run and long-run impacts of financial development, digital transformation, and economic growth on environmental sustainability in the Association of Southeast Asian Nations (ASEAN) between 1990 and 2018. By employing the panel autoregressive distributed lag (ARDL) approach, the authors have reached several significant findings. First, financial development and economic growth can adversely affect environmental sustainability in ASEAN countries. This implies that as the money supply expands and economic activities increase, there is a corresponding increase in the ecological deficit. Second, digital transformation has a detrimental effect on the ecological footprint. By embracing sustainable development strategies and utilizing digital solutions, it is possible to reconcile economic advancement with the preservation of the environment. These results offer empirical evidence and valuable policy recommendations to support more sustainable economic development in ASEAN countries.