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The Regulatory Quality and ESG Model at World Level

Author

Listed:
  • Alberto Costantiello

    (LUM - Università LUM Giuseppe Degennaro = University Giuseppe Degennaro)

  • Angelo Leogrande

    (LUM - Università LUM Giuseppe Degennaro = University Giuseppe Degennaro)

Abstract

In this article, we analyse the determinants of Regulatory Quality-RQ for 193 countries in the period 2011-2020. We use a database from ESG-Environment Social Governance of the World Bank. We apply OLS, Panel Data with Fixed Effects and Panel Data with Random Effects. We found that the variables that have the most positive impact on RQ, among others, are "GHG Net Emission", "Mean Drought Index", and "Heat Index". We also found that the variables that have the most negative impact on RQ are among others "Renewable Energy Consumption", "Voice and Accountability" and "Rule of Law". Furthermore, we have applied the k-Means algorithm optimized with the Elbow Method and we find the presence of five clusters. In adjunct, we confront eight machine learning algorithms to predict the value of RQ and we found that the best predictor is Polynomial Regression. The predictive level of RQ for the analysed countries is expected to diminish of-1,29%. In the end, we present a network analysis with the Euclidean distance and we found the presence of a structure of seven networks using augmented data.

Suggested Citation

  • Alberto Costantiello & Angelo Leogrande, 2023. "The Regulatory Quality and ESG Model at World Level," Working Papers hal-04029322, HAL.
    • Handle: RePEc:hal:wpaper:hal-04029322
    Note: View the original document on HAL open archive server: https://hal.science/hal-04029322v1
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    References listed on IDEAS

    as
    1. Chien-Chiang Lee & Godwin Olasehinde-Williams & Ifedolapo Olanipekun, 2021. "Financial systems, regulatory quality, and economic growth," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 30(2), pages 246-274, February.
    2. Curti, Filippo & Mihov, Atanas, 2018. "Fraud recovery and the quality of country governance," Journal of Banking & Finance, Elsevier, vol. 87(C), pages 446-461.
    3. Hafiz Waqas Kamran & Shamsul Bahrain bin Mohamed Arshad & Abdelnaser Omran, 2019. "Country Governance, Market Concentration and Financial Market Dynamics for Banks Stability in Pakistan," Research in World Economy, Research in World Economy, Sciedu Press, vol. 10(2), pages 136-146, July.
    4. Kaller, Alexander & Bielen, Samantha & Marneffe, Wim, 2018. "The impact of regulatory quality and corruption on residential electricity prices in the context of electricity market reforms," Energy Policy, Elsevier, vol. 123(C), pages 514-524.
    5. Destek, Mehmet Akif & Adedoyin, Festus & Bekun, Festus Victor & Aydin, Sercan, 2023. "Converting a resource curse into a resource blessing: The function of institutional quality with different dimensions," Resources Policy, Elsevier, vol. 80(C).
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Leogrande, Angelo & Costantiello, Alberto, 2023. "The Role of GDP Growth in the ESG Approach at World Level," SocArXiv 93sn2, Center for Open Science.
    2. Angelo Leogrande & Alberto Costantiello, 2023. "The Labor Force Participation Rate in the Context of ESG Models at World Level," Working Papers hal-04114330, HAL.
    3. Costantiello, Alberto & Leogrande, Angelo, 2023. "The Determinants of CO2 Emissions in the Context of ESG Models at World Level," MPRA Paper 117110, University Library of Munich, Germany.
    4. repec:osf:socarx:ra5ux_v1 is not listed on IDEAS
    5. Rekurd S Maghdid & Saeed Mohammed Kareem & Yaseen Salih Hama & Muhammad Waris & Rana Tahir Naveed, 2024. "Moderating role of political stability and economic policy uncertainty between country governance practice and stock market performance. A comparative analysis of Pakistan and Kurdistan Region of Iraq," PLOS ONE, Public Library of Science, vol. 19(4), pages 1-16, April.
    6. Costantiello, Alberto & Leogrande, Angelo, 2023. "The Role of Political Stability in the Context of ESG Models at World Level," MPRA Paper 116887, University Library of Munich, Germany.
    7. repec:osf:socarx:r56hu_v1 is not listed on IDEAS

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    JEL classification:

    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation

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