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How infrastructure development, technological innovation, and institutional quality impact the environmental quality of G7 countries: A step towards environmental sustainability

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  • Badee Uz Zaman
  • Hui‐Yun Yu

Abstract

Despite the economic success, the G7 nations have not adequately prioritized environmental welfare. However, these nations must recognize that economic prosperity cannot be sustained without safeguarding environmental sustainability. In short, environmental protection is a necessary component of achieving sustainable development goals. For this matter, this study aims to analyze the effects of accumulative infrastructure development, economic growth, foreign direct investment, technological innovation, and institutional quality on the CO2 emissions of the G7 countries. Using annual panel data from 1996 to 2020, this study employs cross‐sectional autoregressive distributed lags (CS‐ARDL) to determine the environmental impacts of the variables under investigation. The findings show that foreign direct investment and institutional quality have a favorable effect and improve environmental quality. In contrast, the accumulative (transport, energy, financial, and information and communication [ICT]) infrastructure development, economic growth, and technological innovation stimulate environmental degradation by increasing CO2 emissions. These results are found robust, as validated by the Common Correlated Effect Mean Group (CCEMG). In line with these crucial findings, governments have suggested that specific measures supporting innovation in environmental‐related technologies, infrastructure development, and economic growth must be implemented to mitigate CO2 emissions in the G7 countries.

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  • Badee Uz Zaman & Hui‐Yun Yu, 2024. "How infrastructure development, technological innovation, and institutional quality impact the environmental quality of G7 countries: A step towards environmental sustainability," Sustainable Development, John Wiley & Sons, Ltd., vol. 32(4), pages 3495-3517, August.
  • Handle: RePEc:wly:sustdv:v:32:y:2024:i:4:p:3495-3517
    DOI: 10.1002/sd.2850
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