The dampening effect of geopolitical risk and economic policy uncertainty in the linkage between economic complexity and environmental degradation in the G-20

Evcimen, Ceren

The question remains whether high geopolitical risk and economic policy uncertainty will have a dampening or enhancing effect on pollution factors. In this regard, the study empirically investigates the effects of economic complexity, geopolitical risk, economic policy uncertainty, renewable energy consumption and economic growth on environmental pollution for G-20 countries from 1997 to 2018. The long-term coefficient estimates, derived from the FMOLS estimator, support the inverted U-shaped EKC linkages between economic complexity and ecological footprint, carbon footprint and carbon dioxide emissions. Furthermore, over the long term, geopo litical risks, renewable energy use, and the interaction between economic complexity and policy uncertainty have a positive impact on environmental q...