Exploring the Path to Carbon Neutrality in Prominent Asian Nations: How Green Technological Advancements, Transportation Initiatives, and Financial Progression Work?

This study investigates the interplay between green technology innovation, transportation systems, financial development, and carbon emissions within a sample of 10 nations in North and South East Asia over the period 1995–2021. Utilizing fully modified ordinary least squares (FMOLS) and augmented mean group (AMG) techniques, the study accounts for heterogeneity across different countries and regions. Heterogeneous panel non-causality test is also employed to analyze the direction of causality. The results reveal a significant negative correlation between green technology innovation (GTI) and carbon emissions, suggesting that technological advancements contribute to carbon emission reduction. A negative correlation is also observed between transportation and carbon emissions, indicating that infrastructure development does not let the quality of the environment deteriorate in these countries. Additionally, we find financial development positively affect carbon emission, which means that more attention needs to be paid on environmental issues when developing economy. The study confirms the presence of the environmental kuznets curve (EKC) hypothesis, highlighting the complex relationship between economic growth and environmental degradation. The findings underscore the need for policy interventions to balance economic development with environmental sustainability.