IDEAS home Printed from https://ideas.repec.org/a/eee/renene/v257y2026ics0960148125024309.html

Environmental regulation, economic policy uncertainty, and geopolitical risk: Impacts on energy productivity in OECD countries

Author

Listed:
  • Liu, Yang

Abstract

As global energy demand grows and environmental pressures intensify; emerging countries face the dual challenge of sustaining economic growth while improving energy efficiency. This study explores the relationship between renewable energy (RE) utilization, gross domestic product (GDP), and energy productivity (ET) from 1990 to 2021. Advanced econometric methods, including the Autoregressive Distributed Lag (ARDL), Dynamic Ordinary Least Squares (DOLS), Fully Modified Ordinary Least Squares (FMOLS), and Canonical Cointegration Regression (CCR), are applied to assess short- and long-run dynamics. Data were obtained from several international sources: the Organization for Economic Co-operation and Development (OECD) for energy productivity and environmental regulation (ER), the Caldara and Iacoviello Geopolitical Risk (GPR) index from the International Monetary Fund (IMF), the World Intellectual Property Organization (WIPO) for technological innovation (TI), and national accounts for GDP. Results show that environmental regulation consistently enhances energy productivity, while geopolitical risk data exerts a negative impact, hindering clean energy transitions. Economic Policy Uncertainty (EPU) displays mixed but often positive effects, driving structural reforms and technological adoption. Granger causality tests further confirm reciprocal relationships among Environmental Regulation (ER), Economic Policy Uncertainty (EPU), Geopolitical Risk (GPR), and Energy Productivity (ET). These findings highlight the need for coherent policies, geopolitical stability, and innovation to strengthen long-term energy productivity and sustainable growth.

Suggested Citation

  • Liu, Yang, 2026. "Environmental regulation, economic policy uncertainty, and geopolitical risk: Impacts on energy productivity in OECD countries," Renewable Energy, Elsevier, vol. 257(C).
    • Handle: RePEc:eee:renene:v:257:y:2026:i:c:s0960148125024309
    DOI: 10.1016/j.renene.2025.124766
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0960148125024309
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.renene.2025.124766?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

    for a different version of it.

    References listed on IDEAS

    as
    1. Ha, Le Thanh, 2024. "Dynamic spill-over influences of FinTech innovation development on renewable energy volatility during the time of war in pandemic: A novel insight from a wavelet model," Economic Analysis and Policy, Elsevier, vol. 82(C), pages 515-529.
    2. Lee, Chi-Chuan & Li, Xinrui & Yu, Chin-Hsien & Zhao, Jinsong, 2022. "The contribution of climate finance toward environmental sustainability: New global evidence," Energy Economics, Elsevier, vol. 111(C).
    3. Lin, Chao & Cai, Peipei, 2023. "Analyzing the impacts of natural resource utilization and green economic growth in China: Evidence from a econometric analysis," Resources Policy, Elsevier, vol. 81(C).
    4. Peng, Hong & Chen, Hailin & Sun, Yong & Zhang, Xiaofeng & Abubakar, M., 2024. "Environmental economics of green recovery in mineral extraction: Balancing production and conservation," Resources Policy, Elsevier, vol. 96(C).
    5. Wang, Zhenni & Tan, Qiaofeng & Wen, Xin & Su, Huaying & Fang, Guohua & Wang, Hao, 2025. "Capacity optimization of retrofitting cascade hydropower plants with pumping stations for renewable energy integration: A case study," Applied Energy, Elsevier, vol. 377(PC).
    6. Zhao, Xin-Xin & Zheng, Mingbo & Fu, Qiang, 2022. "How natural disasters affect energy innovation? The perspective of environmental sustainability," Energy Economics, Elsevier, vol. 109(C).
    7. Drago, Carlo & Gatto, Andrea, 2022. "Policy, regulation effectiveness, and sustainability in the energy sector: A worldwide interval-based composite indicator," Energy Policy, Elsevier, vol. 167(C).
    8. Chen, Yifan & Yang, Liuquan & Yang, Chao & Wang, Weida & Zha, Mingjun & Gao, Pu & Liu, Hui, 2024. "Real-time analytical solution to energy management for hybrid electric vehicles using intelligent driving cycle recognition," Energy, Elsevier, vol. 307(C).
    9. Ahmed Samour & M. Mine Baskaya & Turgut Tursoy, 2022. "The Impact of Financial Development and FDI on Renewable Energy in the UAE: A Path towards Sustainable Development," Sustainability, MDPI, vol. 14(3), pages 1-14, January.
    10. Asif Raihan & Mamunur Rashid & Liton Chandra Voumik & Salma Akter & Miguel Angel Esquivias, 2023. "The Dynamic Impacts of Economic Growth, Financial Globalization, Fossil Fuel, Renewable Energy, and Urbanization on Load Capacity Factor in Mexico," Sustainability, MDPI, vol. 15(18), pages 1-21, September.
    11. Muhammad Umair & Waqar Ahmad & Babar Hussain & Valentin Marian Antohi & Costinela Fortea & Monica Laura Zlati, 2024. "The Role of Labor Force, Physical Capital, and Energy Consumption in Shaping Agricultural and Industrial Output in Pakistan," Sustainability, MDPI, vol. 16(17), pages 1-26, August.
    12. Alex W. J. Cheng & Harry F. Lee, 2022. "Energy Transition towards Sustainable Development: Perspective of Individuals’ Engagement Amid Transition Process," Sustainability, MDPI, vol. 14(16), pages 1-16, August.
    13. Wu, He & Feng, Ziyang & Sun, Tianjun & Li, Rongrong & Zhao, Haoyuan, 2024. "Efficiency, sustainability, and resilience a trifecta for a green economic recovery through natural resource markets," Resources Policy, Elsevier, vol. 88(C).
    14. Wu, Qihan & Yan, Dong & Umair, Muhammad, 2023. "Assessing the role of competitive intelligence and practices of dynamic capabilities in business accommodation of SMEs," Economic Analysis and Policy, Elsevier, vol. 77(C), pages 1103-1114.
    15. Qi Cui & Xiaoyu Ma & Sisi Zhang, 2023. "Does green finance drive low-carbon economic development? Evidence from China," Economic Research-Ekonomska Istraživanja, Taylor & Francis Journals, vol. 36(3), pages 2183421-218, December.
    16. Guan, Chenghua & Huang, Jinyuan & Jiang, Ruyue & Xu, Wanting, 2023. "The impact of pilot free trade zone on service industry structure upgrading," Economic Analysis and Policy, Elsevier, vol. 78(C), pages 472-491.
    17. Li, ChangZheng & Umair, Muhammad, 2023. "Does green finance development goals affects renewable energy in China," Renewable Energy, Elsevier, vol. 203(C), pages 898-905.
    18. Mei Zhang & Kazeem Bello Ajide & Lanre Ibrahim Ridwan, 2022. "Heterogeneous dynamic impacts of nonrenewable energy, resource rents, technology, human capital, and population on environmental quality in Sub-Saharan African countries," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(10), pages 11817-11851, October.
    19. AlNemer, Hashem A. & Hkiri, Besma & Tissaoui, Kais, 2023. "Dynamic impact of renewable and non-renewable energy consumption on CO2 emission and economic growth in Saudi Arabia: Fresh evidence from wavelet coherence analysis," Renewable Energy, Elsevier, vol. 209(C), pages 340-356.
    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. Fan, Qingzhu & Gao, Wang, 2024. "Climate risk and financial stability: The mediating effect of green credit," Finance Research Letters, Elsevier, vol. 65(C).
    2. Zhang, Chiming & Chen, Kaijia, 2026. "Unravelling the interplay of crude oil, renewable energy, and commodity price volatility: A DCC-GARCH model approach on the Chinese stock market," Renewable Energy, Elsevier, vol. 256(PD).
    3. Li, Ziyao & Dai, Liuyi, 2024. "Impact of energy stability, natural resources, and energy efficiency on ecological sustainability," Resources Policy, Elsevier, vol. 90(C).
    4. Liu, Bing & Zhang, Xiangmeng, 2024. "The impact of ESG and executive structure on the default risk of family businesses: Evidence from China," Finance Research Letters, Elsevier, vol. 61(C).
    5. Wang, Wanqi & Qu, Zhaoguang, 2024. "Sustainable finance for promoting prosperity and recovery: The impact of mobilizing capital to expand natural resource efficiency," Resources Policy, Elsevier, vol. 91(C).
    6. Haroon, Muhammad & Ullah, Mirzat & Li, Zhanqiang & Zhu, Shuo & Wang, Judong & Hsueh, Chu-Pin (Eugune), 2025. "Impact of emerging technologies on corporate social responsibility in mining industry," Resources Policy, Elsevier, vol. 102(C).
    7. Xiaodan Zhang, 2024. "RETRACTED ARTICLE: Long-term goal: the role of economic transformation and reorganization in the energy transition," Economic Change and Restructuring, Springer, vol. 57(2), pages 1-19, April.
    8. Yu, Miaozhi & Wang, Yifan & Umair, Muhammad, 2024. "Minor mining, major influence: Economic implications and policy challenges of artisanal gold mining," Resources Policy, Elsevier, vol. 91(C).
    9. Guo, Yating & Rosland, Anitha & Ishak, Suryati & Muhammad Senan, Mohammad Khair Afham, 2023. "Public spending and natural resources development: A way toward green economic growth in China," Resources Policy, Elsevier, vol. 86(PB).
    10. Zhong, Xingxing & Zhao, Lei, 2024. "Alternative economic strategies for an ecological resurrection: The case of natural resource markets," Resources Policy, Elsevier, vol. 90(C).
    11. Zheng, Xiumin & Imran, Muhammad & Umair, Muhammad & Lin, Chen & Dong, Yue, 2025. "Modern panelizing and optimization techniques for renewable energy projects; perspectives on how CO2 emissions impact the circular economy," Energy, Elsevier, vol. 323(C).
    12. Bai, Rui & Lin, Boqiang, 2023. "Nexus between green finance development and green technological innovation: A potential way to achieve the renewable energy transition," Renewable Energy, Elsevier, vol. 218(C).
    13. Wang, Yan & Yang, Tianxiao & Liu, Zhaomin & Chi, Zhong & Lu, Lili, 2024. "Combining natural resources to drive technology and efficiency for a greener economic recovery," Resources Policy, Elsevier, vol. 89(C).
    14. Bai, Bing, 2023. "Fiscal stimulus and natural resource efficiency: A comprehensive approach to a green economic recovery," Resources Policy, Elsevier, vol. 86(PB).
    15. Meng, Fanting, 2024. "Driving sustainable development: Fiscal policy and the promotion of natural resource efficiency," Resources Policy, Elsevier, vol. 90(C).
    16. Li, Zerong & Li, Lan & Hui, Mo, 2024. "Fostering green economic growth through sustainable management of natural resources," Resources Policy, Elsevier, vol. 91(C).
    17. Ruan, Yunsheng & Wang, Wenqing & Abubakar, Muhammad & Ahmad, Nazeer, 2025. "Global economic resilience: Developing green growth strategies, renewable energy integration, and environmental economics for sustainability," Renewable Energy, Elsevier, vol. 251(C).
    18. Huang, Weiping & Min, Hui, 2025. "Social license for the hydrogen economy: Evidence from a choice-based conjoint study on public acceptance," Energy, Elsevier, vol. 335(C).
    19. Lei, Hao & Zhu, Yu & Tan, Jinlong & Zhang, Xiaofeng, 2024. "Blending financial innovation with natural resource utilization: Pathways to green economic expansion," Resources Policy, Elsevier, vol. 89(C).
    20. Aziz, Muhammad, 2026. "Hydrogen energy integration for renewable power transition in South Asia: A strategic assessment towards sustainable development," Renewable Energy, Elsevier, vol. 258(C).

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    JEL classification:

    Statistics

    Access and download statistics

    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:renene:v:257:y:2026:i:c:s0960148125024309. 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.journals.elsevier.com/renewable-energy .

    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.