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Dynamic Influence of Urbanization on Inclusive Green Growth in Belt and Road Countries: The Moderating Role of Governance

Author

Listed:
  • Na Wang

    (School of Law, Southwestern University of Finance and Economics, Chengdu 610074, China)

  • Atta Ullah

    (School of Management, Huazhong University of Science and Technology, Wuhan 430074, China)

  • Xiaofeng Lin

    (Koguan School of Law, Shanghai Jiao Tong University, Shanghai 200240, China)

  • Taiming Zhang

    (Finance Department, Business School, The University of Edinburgh, Edinburgh EH8 9YL, UK)

  • Jie Mao

    (School of Public Administration, Southwestern University of Finance and Economics, Chengdu 610074, China)

Abstract

The strategic objective of this study was to determine the influence of urbanization on inclusive green growth (IGG) with the moderating impact of governance while considering household consumption, exchange rate, per capita income, and the unemployment rate as control variables. The data set consisted of the years 2004–2019 for 64 countries along the Belt and Road (BRI) region. The outcomes of the two-step system of generalized method of moments (GMM) robust with D-K regression methodology confirmed the significantly positive dynamic nature of inclusive green growth. Urbanization showed a significant but negative influence on inclusive green growth, indicating environmental degradation due to unplanned urban growth. The moderating role of governance also depicted a significant negative impact, emphasizing the need for a transparent governance framework for BRI countries to utilize resources effectively. Moreover, the interaction term of urbanization and governance showed a significantly positive improvement toward inclusive green growth. Besides this, per capita income played a significantly positive role, while unemployment and household consumption had a negative but significant influence on inclusive green growth. Further, the exchange rate impacted insignificantly on inclusive green growth. Hence, it is evident that urbanization, good governance, and employment opportunities are required to promote sustainable green growth in BRI countries. The research identifies the factors that are required for sustainability/IGG.

Suggested Citation

  • Na Wang & Atta Ullah & Xiaofeng Lin & Taiming Zhang & Jie Mao, 2022. "Dynamic Influence of Urbanization on Inclusive Green Growth in Belt and Road Countries: The Moderating Role of Governance," Sustainability, MDPI, vol. 14(18), pages 1-18, September.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:18:p:11623-:d:916430
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