IDEAS home Printed from https://ideas.repec.org/a/eee/appene/v364y2024ics0306261924005750.html
   My bibliography  Save this article

Exploring synergistic and individual causal effects of rare earth elements and renewable energy on multidimensional economic complexity for sustainable economic development

Author

Listed:
  • Abbas, Khizar
  • Han, Mengyao
  • Xu, Deyi
  • Butt, Khalid Manzoor
  • Baz, Khan
  • Cheng, Jinhua
  • Zhu, Yongguang
  • Hussain, Sanwal

Abstract

The ongoing global energy transition has highlighted the instrumental role of rare earth elements (REEs) in achieving green growth through the deployment of renewable energy technologies, establishing a hypothetical progressive synergistic association between them. Therefore, testing this hypothetical synergy and its potential causal effects on economic and technological proxies based on empirical foundations becomes imperative in addressing rampant climatic change. First, we employed Deep Learning algorithms to explore the combined effects of this synergy on Multidimensional Economic Complexity (MEC) as an index using panel data of the largest producers of REEs from 1990 to 2023. Second, Temporal Causal Modelling (TCM) was employed to unveil the directional causality between REEs and renewable energy, as well as their causal roles in driving economic complexities. The deep learning models accurately predicted the positive role of this synergistic relationship in promoting overall MEC. Then, the results of TCM reveal that REE production increases renewable energy use and reduces CO2 emissions. Renewable energy promotes Research and Technology complexities while REE production affects them indirectly through renewables. It implies that harnessing this synergy to enhance economic complexities can, in turn, bolster green economic and technological development while mitigating CO2 emissions and addressing pervasive climate change.

Suggested Citation

  • Abbas, Khizar & Han, Mengyao & Xu, Deyi & Butt, Khalid Manzoor & Baz, Khan & Cheng, Jinhua & Zhu, Yongguang & Hussain, Sanwal, 2024. "Exploring synergistic and individual causal effects of rare earth elements and renewable energy on multidimensional economic complexity for sustainable economic development," Applied Energy, Elsevier, vol. 364(C).
    • Handle: RePEc:eee:appene:v:364:y:2024:i:c:s0306261924005750
    DOI: 10.1016/j.apenergy.2024.123192
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0306261924005750
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.apenergy.2024.123192?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Cesar A. Hidalgo & Ricardo Hausmann, 2009. "The Building Blocks of Economic Complexity," Papers 0909.3890, arXiv.org.
    2. Bouteska, Ahmed & Hajek, Petr & Fisher, Ben & Abedin, Mohammad Zoynul, 2023. "Nonlinearity in forecasting energy commodity prices: Evidence from a focused time-delayed neural network," Research in International Business and Finance, Elsevier, vol. 64(C).
    3. Narayan, Seema & Doytch, Nadia, 2017. "An investigation of renewable and non-renewable energy consumption and economic growth nexus using industrial and residential energy consumption," Energy Economics, Elsevier, vol. 68(C), pages 160-176.
    4. Logan G. Wright & Tatsuhiro Onodera & Martin M. Stein & Tianyu Wang & Darren T. Schachter & Zoey Hu & Peter L. McMahon, 2022. "Deep physical neural networks trained with backpropagation," Nature, Nature, vol. 601(7894), pages 549-555, January.
    5. Hausmann, Ricardo & Hidalgo, César A., 2010. "Country Diversification, Product Ubiquity, and Economic Divergence," Scholarly Articles 4554740, Harvard Kennedy School of Government.
    6. Tiwari, Aviral Kumar & Adewuyi, Adeolu O. & Adeleke, Musefiu Adebowale & Abakah, Emmanuel Joel Aikins, 2023. "A time-varying Granger causality analysis between water stock and green stocks using novel approaches," Energy Economics, Elsevier, vol. 126(C).
    7. Andreas Goldthau & Llewelyn Hughes, 2020. "Protect global supply chains for low-carbon technologies," Nature, Nature, vol. 585(7823), pages 28-30, September.
    8. Rahman, Mohammad Mafizur & Vu, Xuan-Binh, 2020. "The nexus between renewable energy, economic growth, trade, urbanisation and environmental quality: A comparative study for Australia and Canada," Renewable Energy, Elsevier, vol. 155(C), pages 617-627.
    9. Timothy Ault & Steven Krahn & Allen Croff, 2015. "Radiological Impacts and Regulation of Rare Earth Elements in Non-Nuclear Energy Production," Energies, MDPI, vol. 8(3), pages 1-16, March.
    10. Yong Geng & Joseph Sarkis & Raimund Bleischwitz, 2019. "How to globalize the circular economy," Nature, Nature, vol. 565(7738), pages 153-155, January.
    11. Qi Xu & Salim Khan, 2023. "How Do R&D and Renewable Energy Consumption Lead to Carbon Neutrality? Evidence from G-7 Economies," IJERPH, MDPI, vol. 20(5), pages 1-15, March.
    12. Romano, Antonio A. & Scandurra, Giuseppe & Carfora, Alfonso & Fodor, Mate, 2017. "Renewable investments: The impact of green policies in developing and developed countries," Renewable and Sustainable Energy Reviews, Elsevier, vol. 68(P1), pages 738-747.
    13. Laura J. Sonter & Marie C. Dade & James E. M. Watson & Rick K. Valenta, 2020. "Renewable energy production will exacerbate mining threats to biodiversity," Nature Communications, Nature, vol. 11(1), pages 1-6, December.
    14. Elshkaki, Ayman & Graedel, T.E., 2014. "Dysprosium, the balance problem, and wind power technology," Applied Energy, Elsevier, vol. 136(C), pages 548-559.
    15. Jiang, Peng & Fan, Yee Van & Klemeš, Jiří Jaromír, 2021. "Impacts of COVID-19 on energy demand and consumption: Challenges, lessons and emerging opportunities," Applied Energy, Elsevier, vol. 285(C).
    16. Jones, Ben & Elliott, Robert J.R. & Nguyen-Tien, Viet, 2020. "The EV revolution: The road ahead for critical raw materials demand," Applied Energy, Elsevier, vol. 280(C).
    17. Lei Jin & Keran Duan & Xu Tang, 2018. "What Is the Relationship between Technological Innovation and Energy Consumption? Empirical Analysis Based on Provincial Panel Data from China," Sustainability, MDPI, vol. 10(1), pages 1-13, January.
    18. Liang, Yanan & Kleijn, René & van der Voet, Ester, 2023. "Increase in demand for critical materials under IEA Net-Zero emission by 2050 scenario," Applied Energy, Elsevier, vol. 346(C).
    19. Shah, Syed Ale Raza & Naqvi, Syed Asif Ali & Riaz, Sabahat & Anwar, Sofia & Abbas, Nasir, 2020. "Nexus of biomass energy, key determinants of economic development and environment: A fresh evidence from Asia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 133(C).
    20. Takaaki Hatanaka & Akimasa Matsugami & Takamasa Nonaka & Hideki Takagi & Fumiaki Hayashi & Takao Tani & Nobuhiro Ishida, 2017. "Rationally designed mineralization for selective recovery of the rare earth elements," Nature Communications, Nature, vol. 8(1), pages 1-10, August.
    21. Kleijn, René & van der Voet, Ester & Kramer, Gert Jan & van Oers, Lauran & van der Giesen, Coen, 2011. "Metal requirements of low-carbon power generation," Energy, Elsevier, vol. 36(9), pages 5640-5648.
    22. Igogo, Tsisilile & Awuah-Offei, Kwame & Newman, Alexandra & Lowder, Travis & Engel-Cox, Jill, 2021. "Integrating renewable energy into mining operations: Opportunities, challenges, and enabling approaches," Applied Energy, Elsevier, vol. 300(C).
    23. Ballinger, Benjamin & Stringer, Martin & Schmeda-Lopez, Diego R. & Kefford, Benjamin & Parkinson, Brett & Greig, Chris & Smart, Simon, 2019. "The vulnerability of electric vehicle deployment to critical mineral supply," Applied Energy, Elsevier, vol. 255(C).
    24. Bhattacharya, Mita & Paramati, Sudharshan Reddy & Ozturk, Ilhan & Bhattacharya, Sankar, 2016. "The effect of renewable energy consumption on economic growth: Evidence from top 38 countries," Applied Energy, Elsevier, vol. 162(C), pages 733-741.
    25. Cai, Fengyang & Chang, Huawei & Yang, Zhengbo & Tu, Zhengkai, 2024. "Experimental study on self-heating strategy of lithium-ion battery at low temperatures based on bidirectional pulse current," Applied Energy, Elsevier, vol. 354(PB).
    26. Das, Khanindra Ch. & Mahalik, Mantu Kumar, 2023. "Renewable energy use and export performance of manufacturing firms: Panel evidence from six industries in India," Energy Economics, Elsevier, vol. 125(C).
    27. Uzar, Umut, 2020. "Political economy of renewable energy: Does institutional quality make a difference in renewable energy consumption?," Renewable Energy, Elsevier, vol. 155(C), pages 591-603.
    28. Ozcan, Burcu & Ozturk, Ilhan, 2019. "Renewable energy consumption-economic growth nexus in emerging countries: A bootstrap panel causality test," Renewable and Sustainable Energy Reviews, Elsevier, vol. 104(C), pages 30-37.
    29. Viktor Stojkoski & Philipp Koch & C'esar A. Hidalgo, 2022. "Multidimensional Economic Complexity and Inclusive Green Growth," Papers 2209.08382, arXiv.org, revised Apr 2023.
    30. Hayakawa, Kazunobu & Mukunoki, Hiroshi, 2021. "The impact of COVID-19 on international trade: Evidence from the first shock," Journal of the Japanese and International Economies, Elsevier, vol. 60(C).
    31. Leah C. Stokes & Christopher Warshaw, 2017. "Renewable energy policy design and framing influence public support in the United States," Nature Energy, Nature, vol. 2(8), pages 1-6, August.
    32. Chica-Olmo, Jorge & Sari-Hassoun, Salaheddine & Moya-Fernández, Pablo, 2020. "Spatial relationship between economic growth and renewable energy consumption in 26 European countries," Energy Economics, Elsevier, vol. 92(C).
    33. Murad, Wahid & Alam, Md. Mahmudul & Noman, Abu Hanifa Md. & OZTURK, Ilhan, 2019. "Dynamics Of Technological Innovation, Energy Consumption, Energy Price And Economic Growth In Denmark," SocArXiv 4m27y, Center for Open Science.
    34. Qing Yang & Hewen Zhou & Pietro Bartocci & Francesco Fantozzi & Ondřej Mašek & Foster A. Agblevor & Zhiyu Wei & Haiping Yang & Hanping Chen & Xi Lu & Guoqian Chen & Chuguang Zheng & Chris P. Nielsen &, 2021. "Prospective contributions of biomass pyrolysis to China’s 2050 carbon reduction and renewable energy goals," Nature Communications, Nature, vol. 12(1), pages 1-12, December.
    35. Apergis, Emmanuel & Apergis, Nicholas, 2017. "The role of rare earth prices in renewable energy consumption: The actual driver for a renewable energy world," Energy Economics, Elsevier, vol. 62(C), pages 33-42.
    36. Burleyson, Casey D. & Rahman, Aowabin & Rice, Jennie S. & Smith, Amanda D. & Voisin, Nathalie, 2021. "Multiscale effects masked the impact of the COVID-19 pandemic on electricity demand in the United States," Applied Energy, Elsevier, vol. 304(C).
    37. Baz, Khan & Xu, Deyi & Ampofo, Gideon Minua Kwaku & Ali, Imad & Khan, Imran & Cheng, Jinhua & Ali, Hashmat, 2019. "Energy consumption and economic growth nexus: New evidence from Pakistan using asymmetric analysis," Energy, Elsevier, vol. 189(C).
    38. Yong Geng & Joseph Sarkis & Raimund Bleischwitz, 2023. "How to build a circular economy for rare-earth elements," Nature, Nature, vol. 619(7969), pages 248-251, July.
    39. Al-Orabi, Ahmed M. & Osman, Mohamed G. & Sedhom, Bishoy E., 2023. "Analysis of the economic and technological viability of producing green hydrogen with renewable energy sources in a variety of climates to reduce CO2 emissions: A case study in Egypt," Applied Energy, Elsevier, vol. 338(C).
    40. Cadoret, Isabelle & Padovano, Fabio, 2016. "The political drivers of renewable energies policies," Energy Economics, Elsevier, vol. 56(C), pages 261-269.
    41. Inglesi-Lotz, Roula, 2016. "The impact of renewable energy consumption to economic growth: A panel data application," Energy Economics, Elsevier, vol. 53(C), pages 58-63.
    42. Tian, Jinfang & Yu, Longguang & Xue, Rui & Zhuang, Shan & Shan, Yuli, 2022. "Global low-carbon energy transition in the post-COVID-19 era," Applied Energy, Elsevier, vol. 307(C).
    43. Jakob Runge & Sebastian Bathiany & Erik Bollt & Gustau Camps-Valls & Dim Coumou & Ethan Deyle & Clark Glymour & Marlene Kretschmer & Miguel D. Mahecha & Jordi Muñoz-Marí & Egbert H. Nes & Jonas Peters, 2019. "Inferring causation from time series in Earth system sciences," Nature Communications, Nature, vol. 10(1), pages 1-13, December.
    44. Lincheng, Xu & Yue, Wang & Yong, Yan & Zhanzhong, Hao & Xin, Chen & Fan, Li, 2023. "Optimisation of the electronic structure by rare earth doping to enhance the bifunctional catalytic activity of perovskites," Applied Energy, Elsevier, vol. 339(C).
    45. Su, Chang & Urban, Frauke, 2021. "Circular economy for clean energy transitions: A new opportunity under the COVID-19 pandemic," Applied Energy, Elsevier, vol. 289(C).
    46. Jianxiao Wang & Liudong Chen & Zhenfei Tan & Ershun Du & Nian Liu & Jing Ma & Mingyang Sun & Canbing Li & Jie Song & Xi Lu & Chin-Woo Tan & Guannan He, 2023. "Inherent spatiotemporal uncertainty of renewable power in China," Nature Communications, Nature, vol. 14(1), pages 1-11, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Khribich, Abir & Kacem, Rami H. & Dakhlaoui, Ahlem, 2021. "Causality nexus of renewable energy consumption and social development: Evidence from high-income countries," Renewable Energy, Elsevier, vol. 169(C), pages 14-22.
    2. Namahoro, J.P. & Nzabanita, J. & Wu, Q., 2021. "The impact of total and renewable energy consumption on economic growth in lower and middle- and upper-middle-income groups: Evidence from CS-DL and CCEMG analysis," Energy, Elsevier, vol. 237(C).
    3. Namahoro, Jean Pierre & Wu, Qiaosheng & Xiao, Haijun & Zhou, Na, 2021. "The asymmetric nexus of renewable energy consumption and economic growth: New evidence from Rwanda," Renewable Energy, Elsevier, vol. 174(C), pages 336-346.
    4. Chen, Chaoyi & Pinar, Mehmet & Stengos, Thanasis, 2021. "Determinants of renewable energy consumption: Importance of democratic institutions," Renewable Energy, Elsevier, vol. 179(C), pages 75-83.
    5. Daniel Ştefan Armeanu & Ştefan Cristian Gherghina & George Pasmangiu, 2019. "Exploring the Causal Nexus between Energy Consumption, Environmental Pollution and Economic Growth: Empirical Evidence from Central and Eastern Europe," Energies, MDPI, vol. 12(19), pages 1-27, September.
    6. Olimpia Neagu & Mircea Constantin Teodoru, 2019. "The Relationship between Economic Complexity, Energy Consumption Structure and Greenhouse Gas Emission: Heterogeneous Panel Evidence from the EU Countries," Sustainability, MDPI, vol. 11(2), pages 1-29, January.
    7. Montassar Kahia & Anis Omri & Bilel Jarraya, 2021. "Green Energy, Economic Growth and Environmental Quality Nexus in Saudi Arabia," Sustainability, MDPI, vol. 13(3), pages 1-13, January.
    8. Oryani, Bahareh & Kamyab, Hesam & Mоridiаn, Аli & Azizi, Zahra & Rezania, Shahabaldin & Chelliapan, Shreeshivadasan, 2022. "Does structural change boost the energy demand in a fossil fuel-driven economy? New evidence from Iran," Energy, Elsevier, vol. 254(PC).
    9. Chen, Chaoyi & Pinar, Mehmet & Stengos, Thanasis, 2020. "Renewable energy consumption and economic growth nexus: Evidence from a threshold model," Energy Policy, Elsevier, vol. 139(C).
    10. Chen, Shiu-Sheng & Lin, Tzu-Yu, 2024. "Monetary policy and renewable energy production," Energy Economics, Elsevier, vol. 132(C).
    11. Jeffrey Kouton, 2021. "The impact of renewable energy consumption on inclusive growth: panel data analysis in 44 African countries," Economic Change and Restructuring, Springer, vol. 54(1), pages 145-170, February.
    12. Ibrahiem, Dalia M. & Hanafy, Shaimaa A., 2021. "Do energy security and environmental quality contribute to renewable energy? The role of trade openness and energy use in North African countries," Renewable Energy, Elsevier, vol. 179(C), pages 667-678.
    13. Ravetti, Chiara & Cambini, Carlo, 2021. "Energy Use Beyond GDP: A Dynamic Panel Analysis with Different Development Indicators," Working Papers 10-2021, Copenhagen Business School, Department of Economics.
    14. Ding, Qian & Huang, Jianbai & Chen, Jinyu & Luo, Xianfeng, 2024. "Climate warming, renewable energy consumption and rare earth market: Evidence from the United States," Energy, Elsevier, vol. 290(C).
    15. Tian, Xu & Geng, Yong & Sarkis, Joseph & Gao, Cuixia & Sun, Xin & Micic, Tatyana & Hao, Han & Wang, Xin, 2021. "Features of critical resource trade networks of lithium-ion batteries," Resources Policy, Elsevier, vol. 73(C).
    16. Appiah, Michael & Karim, Sitara & Naeem, Muhammad Abubakr & Lucey, Brian M., 2022. "Do institutional affiliation affect the renewable energy-growth nexus in the Sub-Saharan Africa: Evidence from a multi-quantitative approach," Renewable Energy, Elsevier, vol. 191(C), pages 785-795.
    17. Romualdas Ginevičius & Gracjana Noga & Eigirdas Žemaitis & Barbara Piontek & Karel Šuhajda, 2021. "Comparative Assessment of the Impact of Electricity Consumption in Different Economic Sectors on the Economic Development of the EU Member States," Energies, MDPI, vol. 14(24), pages 1-14, December.
    18. Chang, Chiu-Lan & Fang, Ming, 2022. "Renewable energy-led growth hypothesis: New insights from BRICS and N-11 economies," Renewable Energy, Elsevier, vol. 188(C), pages 788-800.
    19. Ben-Hur Francisco Cardoso & Eva Yamila da Silva Catela & Guilherme Viegas & Fl'avio L. Pinheiro & Dominik Hartmann, 2023. "Export complexity, industrial complexity and regional economic growth in Brazil," Papers 2312.07469, arXiv.org.
    20. Gbolonyo, Emmanuel Y. & Ofori, Isaac K. & Ojong, Nathanael, 2024. "Does Economic Complexity Promote Inclusive Green Growth," EconStor Preprints 298785, ZBW - Leibniz Information Centre for Economics.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:appene:v:364:y:2024:i:c:s0306261924005750. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/405891/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.