Short- and Long-Run Impacts of the Digital Economy on Sustainable Development Goals in GCC Countries: An ARDL-VECM Approach

This research delves into the interconnectedness of economic growth, environmental sustainability, and social development within the six Gulf countries (GCC): Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates. Employing ARDL and VECM methodologies, the study examines the short- and long-run dynamics between these variables from 2010 to 2023. Key findings reveal that while digital initiatives, foreign direct investment (FDI), trade openness, and political stability positively influence economic growth and social development, investments in renewable energy and environmental sustainability may initially impose short-term economic costs. However, these investments are crucial for long-term sustainability and contribute to enhanced social well-being. To foster a more sustainable and equitable future, the study recommends that GCC policymakers prioritize balanced strategies that promote economic growth, environmental sustainability, and social development simultaneously. This study details targeted investments in digital infrastructure, fostering innovation, encouraging sustainable practices, and implementing effective policies to mitigate the short-term costs of transitioning to a more sustainable economy. By adopting such a holistic approach, the GCC states can navigate the challenges and opportunities of sustainable development and ensure a prosperous future for their populations.