Structural change and CO2 emissions: Does information and communication technology matter in BRICS countries?

Abstract

This study examines the impact of structural change and the diffusion of information and communication technologies (ICT) on carbon emissions, focusing on their interaction in the case of the BRICS countries. By including GDP, renewable and non-renewable energy as explanatory variables, we use the PMG-ARDL (Pooled Mean Group Autoregressive Distributed Lag) approach to analyze the impact of ICT and structural change on CO₂ emissions in BRICS countries between 2000 and 2021. The Granger causality approach is used to discuss the causal links between the variables analyzed. Long-run results from the PMG estimator show that GDP and non-renewable energy significantly increase emissions, while renewable energy significantly reduces CO₂ emissions. Although structural change and ICT diffusion individually increase emissions, their interaction has a significant mitigating effect. Granger causality analysis suggests a unidirectional causality from ICT to structural change in the short run. In summary, these findings highlight the synergy between structural change and ICT. Therefore, policy makers can take advantage of this interaction to promote structural transformation to improve energy efficiency and reduce carbon emissions in the BRICS countries.