Green Finance, Technological Innovation and Financial Globalization: Assessing Environmental Quality in MINT Economies

Balancing economic growth and environmental quality (ENQ) remains a critical challenge for emerging economies, particularly in MINT countries (Mexico, Indonesia, Nigeria, and Turkey), where rapid industrialization, urbanization, and globalization impact ENQ. While green finance (GEFIN), technological innovation (TEIN), and globalization (GLOB) are key drivers of sustainability, their interactive effects on ENQ remain underexplored. This study investigates the interactive effects of GEFIN, TEIN, GLOB, and non-renewable energy (NREN) on ENQ, proxied by CO₂ and N₂O emissions from 1990 to 2023. Using Fully Modified Ordinary Least Squares (FMOLS) and Dynamic Ordinary Least Squares (DOLS), we ensure robust long-run estimations while addressing issues like heterogeneity, serial correlation, and endogeneity. Panel cointegration tests confirm a long-run relationship. Data were sourced from the World Bank and the International Energy Agency (IEA). The results reveal that while GEFIN and TEIN initially increase emissions, GLOB mitigates these effects. Specifically, GEFIN increased CO₂ by 69.7% (FMOLS), 53.8% (DOLS), and N2O by 73.1% (FMOLS) and 2.6% (DOLS). TEIN increased CO2 by 10.8% (FMOLS), 4.2% (DOLS), and N₂O by 83.3% (FMOLS) and 14.9% (DOLS). On the other hand, GLOB reduced CO₂ by 33.3% (FMOLS), 26.7% (DOLS), and N₂O by 9.4% (FMOLS) and 10.2% (DOLS). NREN significantly worsens ENQ by increasing emissions. This study supports the Environmental Kuznets Curve hypothesis, revealing an inverted U-shaped relationship between economic growth and ENQ. The interaction terms indicate that GLOB helps mitigate the negative environmental effects of GEFIN and TEIN. We recommend strengthening GEFIN strategies, accelerating the adoption of renewable energy, and leveraging GLOB to enhance ENQ in MINT countries.