Empowering ASEAN’s Economic Growth through Renewable Energy Consumption
DOI:
https://doi.org/10.22452/JIE.vol18no3.6Keywords:
Green investment policies, Energy transition, Sustainable development, Panel estimation, Environmental sustainabilityAbstract
The depletion of non-renewable energy sources and their environmental impact
highlight the urgent need for a transition towards sustainable alternatives. Renewable
energy emerges as a promising solution, particularly for regions like the Association of
Southeast Asian Nations (ASEAN), comprising 10 countries that are vital to both the
Asian and global economies. This study explores whether renewable energy consumption
significantly contributes to ASEAN’s economic growth by employing a comprehensive
methodological approach, including classical panel models, spatial panel models, and
the panel Autoregressive Distributed Lag (ARDL) model. The combined use of these
models allows for a comprehensive analysis by capturing internal country dynamics,
cross-border spillover effects, and both short- and long-run relationships. The empirical
findings reveal that renewable energy consumption has a significant positive impact
on economic growth in ASEAN, with short-run effects requiring at least three years to
manifest. By integrating diverse models, this study provides a more robust and nuanced
understanding of renewable energy’s role in driving growth. Based on these results,
ASEAN policymakers are encouraged to promote renewable energy consumption through
targeted investments, incentives, and infrastructure development, aligning sustainability
with pro-growth strategies like trade openness and technological innovation.
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