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Renewable energy and economic growth: New insight from country risks

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  • Wang, Qiang
  • Dong, Zequn
  • Li, Rongrong
  • Wang, Lili

Abstract

This study explored the relationship between renewable energy consumption and economic growth from new risk-based perspectives, including political risks, financial risks, economic risks and composite risks. The study uses a panel threshold model to empirically analyze panel data for the Organization for Economic Cooperation and Development (OECD) countries from 1997 to 2015. The results show when composite risks and political risks are used as threshold variables, there is a single threshold between renewable energy consumption and economic growth. When that threshold is exceeded, the positive effect of renewable energy on economic development increases. When economic risks and financial risks are used as threshold variables, there is a double threshold between renewable energy consumption and economic growth. When the first threshold value is exceeded, but not the second, renewable energy positively impacts economic development. However, when economic risk and financial risk do not lie between the two threshold values, there is an insignificant negative correlation between renewable energy consumption and economic growth.

Suggested Citation

  • Wang, Qiang & Dong, Zequn & Li, Rongrong & Wang, Lili, 2022. "Renewable energy and economic growth: New insight from country risks," Energy, Elsevier, vol. 238(PC).
    • Handle: RePEc:eee:energy:v:238:y:2022:i:pc:s0360544221022660
    DOI: 10.1016/j.energy.2021.122018
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