Environmental Impact of Business Freedom and Renewable Energy: A Global Perspective

Abstract

This research has examined the impact of business freedom on environmental degradation in developed and developing countries from 2000 to 2022. Panel least squares and generalized method of moments have been applied for empirical analysis. Our findings show that both business freedom and renewable energy consumption have a significant and detrimental influence on environmental degradation in both developed and developing nations. Furthermore, our findings highlight the significant influence of financial development on environmental degradation in both the whole sample and developing nations. Urbanization, on the other hand, has a significant impact on environmental degradation in both developed and developing nations. Interestingly, financial development has a negative and significant impact on environmental degradation in developed nations, while energy consumption has a notable positive and significant relationship with environmental degradation across the board. These findings suggest that the encouragement of entrepreneurial independence and the use of renewable energy sources might be helpful ways for mitigating environmental damage. Addressing the negative consequences of urbanization on the environment is also critical. The short-run dynamics give useful insight for developing tailored strategies to establish a sustainable balance between economic expansion and environmental preservation at the same time.