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Digital Transformation as a Driver of Green Growth: Empirical Evidence from OECD Countries, 2000-2022

Author

Listed:
  • Moussa Hezla

    (Department of Economics, College of Business and Economics, Ouargla University, El Oued, Algeria)

  • Asmaa Zeggane

    (Department of Economics, College of Business and Economics, Mostaganem University, Mostaganem, Algeria)

  • Hadjer Khechekhouche

    (Department of Business Sciences, College of Business and Economics, Eloued University, El Oued, Algeria)

Abstract

This paper examines the multidimensional nexus between digital transformation and green growth across 35 Organisation for Economic Co-operation and Development (OECD) countries over 2000-2022.It focuses on whether digital infrastructure and e‑government interact with renewable energy and environmental policy stringency to sustain productivity‑enhancing, low‑emission growth in advanced economies. Using harmonized OECD and UN sources, the study constructs a composite Digital Transformation Index via principal components analysis (PCA) and a production‑frontier‑consistent Green Growth Index. Second‑generation panel estimators that address cross‑sectional dependence, cointegration, and heterogeneity, alongside panel causality tests, are employed to identify long‑run linkages and directionality. Findings indicate that digital transformation, environmental policy stringency, online public service quality, and renewable energy are positively associated with green growth, whereas public environmental Research and Development (R&D) shows no direct contemporaneous effect. Policy implications call for coordinated investment in digital infrastructure, innovation‑friendly yet stringent environmental regulation, effective e‑governance, and mechanisms that translate R&D into scalable deployment.

Suggested Citation

  • Moussa Hezla & Asmaa Zeggane & Hadjer Khechekhouche, 2025. "Digital Transformation as a Driver of Green Growth: Empirical Evidence from OECD Countries, 2000-2022," Economic Research Guardian, Mutascu Publishing, vol. 15(2), pages 232-267, December.
    • Handle: RePEc:wei:journl:v:15:y:2025:i:2:p:232-267
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    Keywords

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    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • C38 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Classification Methdos; Cluster Analysis; Principal Components; Factor Analysis
    • O44 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Environment and Growth
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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