Economic, regulatory, and financial determinants of renewable energy transitions: Evidence from green bonds and multi-income group analysis

Year 2025, Volume: 10 Issue: 4, 1609 - 1648, 29.12.2025

Burcu Bahçeci Başkurt

https://doi.org/10.58559/ijes.1804071

https://izlik.org/JA56MF77BC

Abstract

This study examines the macroeconomic and institutional drivers of renewable energy adoption across 44 countries during 2014-2019, with particular emphasis on green finance mechanisms. Using panel data analysis with Driscoll-Kraay standard errors, we investigate how economic growth, FDI, green bond issuance, public investment, environmental regulations, and political globalization influence renewable energy usage across different income groups. Results reveal a U-shaped Economic Growth-Renewable Energy relationship, significant positive effects of green bonds (particularly in emerging economies), and evidence supporting the Pollution Haven Hypothesis in lower-middle income countries.

Keywords

Green finance , Renewable energy , Sustainability , Foreign direct investments

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