Examining the nexus between technical investment, trade in services, electricity consumption, and environmental sustainability

This paper examines the interactions between technical investment, trade in services (TS), electricity consumption (EC), economic growth (EG), urbanization, and environmental sustainability indicators (ecological footprint: EF and carbon dioxide: CO2 emissions) in the Kingdom of Saudi Arabia (KSA) from 1990 to 2022. The F-bound test outcomes indicate that these variables are cointegrated. In addition, the ARDL (Auto Regressive Distributed Lag) bounds test findings confirmed that promoting education spending can help achieve environmental sustainability, but research and development (R&D) expenditures have the opposite effect. Toda-Yamamoto causality analysis reveals a bidirectional relationship between trade in services and economic growth. Additionally, CO2 emissions and education are mutually influenced. Following these results, we make the following recommendation: Saudi Arabia’s policy authorities must orient their budgetary policies (education and R&D) to reduce environmental degradation through financing environmentally friendly clean technologies.