Unveiling the effects of economic complexity, climate change, and urbanisation on energy security: Evidence from high-risk countries.

Abstract

Energy security remains a critical issue in both scientific and political debates because of its wide-ranging economic, social, and environmental implications, as well as its influence on policy actions at the global, national, and local levels. However, comprehensive assessments of all key aspects of energy security remain incomplete, and no unified indicators adequately capture a country's level of energy security. To this aim, the study addresses the economic and sociopolitical factors influencing energy security using a novel analytical approach, focusing on countries identified as having the highest levels of energy security. In this regard, the research employs the Energy Security Risk Index (ESRI) developed by Global Energy Institute for the period 1995-2018 to analyses 18 countries with the highest energy security risks. The study employs the method of moments quantile regression (MMQR) to assess the effects of economic growth (EG), economic complexity (EC), CO₂ emissions, and urbanisation on energy security. The main findings of the study indicate that EG and urbanisation have a mitigating effect on energy security risks, whereas CO₂ emissions intensify these risks. Furthermore, the study reveals an inverted U-shaped nonlinear relationship between energy security risk and economic complexity. As key policy implications of the study, these findings suggest that particularly the government and scientific community promote sustainable development through innovative economic policies while prioritizing CO₂ reduction strategies and clean energy alternatives.