Hussein, Oma Ahmedqani; Mohamed, Khadija Shamsi
A icle
Renewable ene gy and globaliza ion in luence: assessing
en i onmen al deg ada ion in Somalia
Cogen Economics & Finance
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Renewable ene gy and globaliza ion influence:
assessing en i onmen al deg ada ion in Somalia
Oma Ahmedqani Hussein & Khadija Shamsi Mohamed
To ci e his a icle: Oma Ahmedqani Hussein & Khadija Shamsi Mohamed (2024) Renewable
ene gy and globaliza ion influence: assessing en i onmen al deg ada ion in Somalia, Cogen
Economics & Finance, 12:1, 2387245, DOI: 10.1080/23322039.2024.2387245
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DEVELOPMENT ECONOMICS | RESEARCH ARTICLE
Renewable ene gy and globaliza ion in luence: assessing
en i onmen al deg ada ion in Somalia
Oma Ahmedqani Hussein
a
and Khadija Shamsi Mohamed
b
a
Facul y o Economics, SIMAD Uni e si y, Mogadishu, Somalia;
b
Facul y o Social Sciences, SIMAD Uni e si y, Mogadishu,
Somalia
ABSTRACT
The p essing issue o en i onmen al deg ada ion unde sco es he u gen need o col-
lec i e ac ion o p ese e and es o e ou plane ’s delica e balance. This s udy in es i-
ga es he ela ionships be ween en i onmen al deg ada ion, globaliza ion, enewable
ene gy adop ion, economic g ow h, and domes ic in es men in Somalia om 1990
o 2020. I u ilizes a ious s a is ical echniques, such as desc ip i e analysis, uni oo
es s, coin eg a ion es s, ARDL analysis, FMOLS, and CCR, o examine sho - e m luc-
ua ions and long- e m pa e ns among hese a iables. The empi ical indings e eal
se e al key insigh s. Renewable ene gy plays a signi ican ole in p omo ing en i on-
men al well-being, bo h in he sho and long e m. On he o he hand, economic
g ow h con ibu es o en i onmen al deg ada ion. Globaliza ion has mixed impac s
ac oss di e en ime ames, sugges ing i s po en ial o suppo en i onmen al p ese -
a ion in he long un. Domes ic in es men also has a modes posi i e in luence on
en i onmen al sus ainabili y. Based on hese indings, he s udy ecommends in es-
ing in enewable ene gy in as uc u e and implemen ing sus ainable g ow h s a -
egies o mi iga e en i onmen al deg ada ion. I emphasizes he impo ance o
s eng hening egula ions and p omo ing eco- iendly p ac ices o minimize ad e se
en i onmen al impac s. Las ly, he s udy highligh s he need o in eg a e en i onmen-
al conside a ions in o policy making p ocesses and os e global solu ions.
IMPACT STATEMENT
Somalia is cu en ly acing signi ican en i onmen al and socio-economic challenges.
The e o e, his s udy c i ically examines how enewable ene gy adap a ion and global-
iza ion can mi iga e he ca bon dioxide emissions in Somalia. By applying ad anced
s a is ical echniques, his esea ch e ealed ha enewable ene gy and globaliza ion
signi ican ly enhance en i onmen al sus ainabili y while economic g ow h exace ba ed
en i onmen al deg ada ion in Somalia. The e ec s o he posi i e in luence o domes-
ic in es men unde sco e he complexi y o hese dynamics, highligh ing he signi i-
can ole each indi idual and en i y can play in shaping a sus ainable u u e. The
signi icance o his s udy lies in i s ac ionable insigh s. I ad oca es o in es men in
enewable ene gy in as uc u e in Somalia, implemen ing sus ainable g ow h s a -
egies, and in eg a ing en i onmen al conside a ions in o policymaking in Somalia. This
esea ch highligh s he need o s eng hened egula ions and eco- iendly p ac ices
and p o ides a i al oadmap o mi iga ing en i onmen al deg ada ion and os e ing
global en i onmen al solu ions. This s udy is o u mos impo ance in he cu en
en i onmen al and socio-economic con ex .
ARTICLE HISTORY
Recei ed 2 Ap il 2024
Re ised 5 June 2024
Accep ed 10 July 2024
KEYWORDS
En i onmen al deg ada ion;
Globaliza ion; Renewable
ene gy; ARDL Model;
Somalia
SUBJECTS
Clima e Change;
Globaliza ion; Al e na i e;
Renewable Ene gy
Indus ies; A ican S udies
1. In oduc ion
The escala ing conce n o e en i onmen al deg ada ion has eme ged as a c i ical global issue, p ima ily
d i en by ex ensi e de o es a ion o ac i i ies such as logging and ag icul u e (Kok e al., 2018; Raihan,
2023). This end is compounded by he ex ac ion o subs an ial quan i ies o ossil uels, mine als, me -
als, and biomass, o aling app oxima ely 55 billion ons annually, exace ba ing he e ec s o clima e
CONTACT Oma Ahmedqani Hussein [email p o ec ed]
ß2024 The Au ho (s). Published by In o ma UK Limi ed, ading as Taylo & F ancis G oup
This is an Open Access a icle dis ibu ed unde he e ms o he C ea i e Commons A ibu ion License (h p://c ea i ecommons.o g/licenses/by/4.0/), which
pe mi s un es ic ed use, dis ibu ion, and ep oduc ion in any medium, p o ided he o iginal wo k is p ope ly ci ed. The e ms on which his a icle has been
published allow he pos ing o he Accep ed Manusc ip in a eposi o y by he au ho (s) o wi h hei consen .
COGENT ECONOMICS & FINANCE
2024, VOL. 12, NO. 1, 2387245
h ps://doi.o g/10.1080/23322039.2024.2387245
change on ecosys ems wo ldwide (Rabba e al., 2022). Recognizing hese di e consequences has
spu ed heigh ened a en ion om scien is s, esea che s, and policymake s, al hough he e o s o mi i-
ga e hese en i onmen al challenges emain insu icien (E ns , 2012; Radmeh e al., 2021). Globaliza ion
has signi ican ly ans o med he ene gy sec o , eshaping i s dis ibu ion, consump ion, and p oduc ion
dynamics. These shi s ca y p o ound implica ions o en i onmen al deg ada ion and he impe a i e
ansi ion owa d enewable ene gy sou ces (Fuinhas e al., 2021; Sun e al., 2022).
The combus ion o ossil uels, including coal, oil, and na u al gas, eleases signi ican quan i ies o
g eenhouse gases such as ca bon dioxide, me hane, and ni ous oxide in o he a mosphe e, wi h p o-
ound implica ions o ecosys ems, biodi e si y, and human well-being (Loucks, 2021; Yo o & Da amola,
2020). Recognizing he ad e se en i onmen al impac s o ossil uel consump ion, he e is a global shi
owa ds enewable ene gy sou ces as a mo e sus ainable al e na i e (Radmeh e al., 2021; Vanegas
Can a e o, 2020; Za a e al., 2020) Renewable ene gy o e s no able syne gies wi h he Sus ainable
De elopmen Goals (SDGs). P ima ily, i u nishes ene gy sou ces wi h minimal en i onmen al ami ica-
ions. In egions like A ica, whe e ene gy access signi ican ly cons ains economic de elopmen and
po e y alle ia ion e o s, adop ing enewable ene gy holds subs an ial p omise (O o i e al., 2022).
Somalia is cu en ly acing signi ican en i onmen al and socio-economic challenges. I is a a c ucial
poin whe e enewable ene gy and globaliza ion can play a i al ole in i s de elopmen . Despi e con i-
bu ing ela i ely low amoun s o global ca bon emissions, Somalia is al eady su e ing om he ad e se
e ec s o clima e change, including equen d ough s, loods, and land deg ada ion. These challenges
pa icula ly h ea en he li elihoods o he popula ion who ely on ag icul u e (Gille , 2020; Wegenas &
Beck, 2020). The po en ial o enewable ene gy in Somalia is immense, especially conside ing he abun-
dance o sola and wind esou ces (Le enda e al., 2021; Vanegas Can a e o, 2020). The Uni ed Na ions
De elopmen P og amme emphasizes ha a ious s udies highligh he signi icance o ha nessing hese
enewable ene gy sou ces in e ec i ely mi iga ing he impac s o global wa ming (UNDP, 2023).
Fu he mo e, he adop ion o enewable ene gy can add ess Somalia’s ene gy access issues, which a e
cu en ly hinde ing e o s owa ds economic de elopmen and po e y alle ia ion. By p o iding eliable
and sus ainable ene gy, enewable sou ces can suppo in as uc u e de elopmen , imp o e heal h and
educa ion se ices, and s imula e economic ac i i ies, pa icula ly in u al a eas (Wa same e al., 2022).
To suppo hese heo e ical claims, Usman e al. (2020) examined he dynamic in e ac ions be ween
he US en i onmen al deg ada ion and di e en a iables such as he use o enewable ene gy, eco-
nomic g ow h, biocapaci y, and ade policies om he i s qua e o 1985 o he ou h qua e o
2014. They we e using an au o eg essi e dis ibu ed lag (ARDL) model. The indings demons a ed a
clea co ela ion be ween he up ake o enewable ene gy sou ces and a educ ion in en i onmen al
deg ada ion, highligh ing he signi icance o p omo ing esea ch and de elopmen as well as in es -
men s in enewable ene gy sou ces such as biomass, sola , hyd opowe , wind, and wa e ene gy (Ta iq
Majeed & Luni, 2019) used a ious me hods o es ima e he e ec i eness o enewable ene gy deploy-
men in educing en i onmen al impac s. These me hods include Pooled OLS, Random E ec s, Fixed
E ec s, and Two S age Leas Squa e. The analysis was based on panel da a om 166 coun ies be ween
1990 and 2017. The esul s showed ha enewable ene gy is an e ec i e way o mi iga e en i onmen al
impac s. Simila ly, Adebayo and Ki ikkaleli (2021) u ilized a ious wa ele echniques on da a om 1990
o 2015 in Japan, indica ing ha using enewable ene gy sou ces e ec i ely educes ca bon dioxide
emissions. Fu he mo e, he s udy has p o en ha he alloca ion o unds owa ds sus ainable esou ces
has inc eased, u he ein o cing he case o i s widesp ead implemen a ion. Gi en his e idence, Japan
should p io i ize bols e ing he expansion o enewable ene gy and cul i a e a mo e conduci e in es -
men en i onmen in he sec o . (Ib ahiem, 2020) also unde sco ed simila esul s in Egyp , indica ing
en i onmen al imp o emen as al e na i e ene gy sou ces inc ease.
On he o he hand, Adams and Nsiah (2019) examined he ela ionship be ween ca bon dioxide emis-
sions and he adop ion o enewable ene gy ac oss 28 Sub-Saha an A ican na ions be ween 1980 and
2014; hei indings we e inconsis en wi h some ini ial hypo heses and yielded esul s ha we e bo h
insigni ican and posi i e o he coun ies s udied because o issues like ou da ed s o age echnology
and ecu en powe ou ages in he a ea. Addi ionally, Hasnisah e al. (2019) examine he connec ions
be ween enewable and non- enewable ene gy use, economic de elopmen , and en i onmen al heal h
in hi een de eloping Asian na ions. using he FMOLS and DOLS es ima o s om 1980 o 2014 as a
2 O. A. HUSSEIN AND K. S. MOHAMED
long- e m sample. None heless, he empi ical da a indica es ha he con ibu ion o enewable ene gy
consump ion o educing CO2 emissions is s ill negligible because de eloping coun ies con inue o ely
hea ily on con en ional ene gy sou ces like ossil uels.
The exis ing li e a u e exhibi s a lack o consis ency, and some easonable explana ions migh be ha
s udies may a y in e ms o me hodology, da a sou ces, pe iods analyzed, s a is ical echniques
employed, and impac o egional and income a ia ions.
Globaliza ion, d i en by echnological ad ancemen s, ade and in es men policy e o ms, and eco-
nomic in e connec edness, has had bo h posi i e and nega i e e ec s on he en i onmen (Se hi e al.,
2020). On one hand, i has led o inc eased esou ce ex ac ion and en i onmen al deg ada ion, pa icu-
la ly in de eloping coun ies (Adebayo e al., 2022). On he o he hand, i has os e ed close in eg a ion
be ween de eloping and de eloped coun ies, c ea ing oppo uni ies o a mo e sus ainable u u e
(Se hi e al., 2020). One po en ial bene i o globaliza ion is i s abili y o accele a e he adop ion o
enewable ene gy in coun ies like Somalia (Chien e al., 2021).
Globaliza ion p omo es in e na ional coope a ion, allowing Somalia o access ad anced echnologies
and expe ise om de eloped coun ies ha a e leade s in enewable ene gy, was e managemen , and
pollu ion con ol. By ans e ing hese echnologies, Somalia can bypass adi ional, mo e pollu ing
ene gy sou ces and ansi ion di ec ly o cleane al e na i es (Wa same e al., 2022). T ade and in es -
men policy e o ms d i en by globaliza ion can a ac o eign di ec in es men (FDI) in o Somalia’s
enewable ene gy sec o . This in es men can inance la ge-scale enewable ene gy p ojec s, c ea e jobs,
and s imula e local economies. Mul ila e al ag eemen s and in e na ional NGOs can also p o ide unding
and echnical suppo o ensu e he success ul implemen a ion o enewable ene gy ini ia i es
(Hickmann & Els€
asse , 2020). Fu he mo e, globaliza ion enhances economic in e connec edness, which
can lead o be e in eg a ion o Somalia in o he global ma ke . This in eg a ion can open up new ma -
ke s o Somali p oduc s, inc easing expo e enues ha can be ein es ed in o sus ainable de elop-
men p ojec s, including enewable ene gy. The esul ing economic g ow h can u he s abilize he
coun y and p o ide a ounda ion o long- e m de elopmen (Wa same e al., 2022).
The exis ing li e a u e has del ed in o his phenomenon, including Jun e al. (2021) employ he
En i onmen al Kuzne s Cu e (EKC) amewo k o in es iga e he impac o globaliza ion, non- enewable
ene gy consump ion, and economic g ow h on CO2 emissions ac oss selec Sou h Asian economies
spanning om 1985 o 2018. Thei empi ical indings e eal a posi i e associa ion be ween CO2 emis-
sions and globaliza ion. Simila ly, Na haniel e al. (2020) examine he in e play among na u al esou ces,
globaliza ion, u baniza ion, and en i onmen al deg ada ion in na ions wi hin La in Ame ica and he
Ca ibbean (LACC) om 1990 o 2017. Thei analysis indica es ha globaliza ion con ibu es o highe
CO2 emissions in LACC coun ies. On he o he hand, Shahbaz e al. (2019) empi ically examine he
dynamic nexus be ween globaliza ion and CO2 emissions ac oss 87 coun ies wi h di e se income le els.
Resul s e ealed ha globaliza ion p edominan ly enhances en i onmen al quali y by educing ca bon
emissions. The e o e, by inc easing income h ough mo e ade and c ea ing in es men oppo uni ies
o imp o e en i onmen al wellbeing. O he s, such as Sain Akadi i e al. (2020), sc u inize he in luence
o eal income, globaliza ion, and ou ism on en i onmen al sus ainabili y goals in Tu key. They employ
he Vec o E o Co ec ion Model (VECM) and Au o eg essi e Dis ibu ed Lag (ARDL), which spans om
1970 o 2014. Thei indings indica e ha globaliza ion does no signi ican ly a ec CO2 emissions in
Tu key ac oss a ious signi icance le els. This ou come unde sco es he impo ance o conside ing spe-
ci ic coun y cha ac e is ics such as indus ial s uc u e, ene gy sou ces, and en i onmen al policies,
which may a y and hus in luence he impac o globaliza ion on CO2 emissions.
Al hough Somalia possesses ample enewable ene gy esou ces, such as sola and wind ene gy, he
coun y has no been adequa ely s udied in e ms o ha nessing hese esou ces o sus ainable de elop-
men (Newell & Bulkeley, 2017). A close examina ion o Somalia’s enewable ene gy po en ial can p o ide
aluable insigh s in o how o he egions wi h simila esou ces can ansi ion o low-ca bon economies.
Despi e p e ious esea ch, no s udies ha e ye explo ed he ela ionship be ween globaliza ion, he
adop ion o enewable ene gy, and en i onmen al deg ada ion in Somalia. This s udy aims o add ess
his gap by in es iga ing how globaliza ion impac s ca bon emissions and how adop ing enewable
ene gy can help mi iga e hem in Somalia. The main objec i e is o analyze he e ec s o globaliza ion
and enewable ene gy adop ion on ca bon emissions in Somalia, while also conside ing pa e ns o
COGENT ECONOMICS & FINANCE 3
economic g ow h and domes ic in es men . Ou esea ch is d i en by he need o unde s and he ac-
o s con ibu ing o en i onmen al deg ada ion in Somalia and o de elop s a egies o sus ainable
g ow h. This opic is o g ea impo ance due o he u gen need o e ec i e clima e change policies,
pa icula ly in de eloping egions like Somalia ha possess abundan enewable esou ces (Newell &
Bulkeley, 2017). We u ilize ad anced econome ic echniques such as he Au o eg essi e Dis ibu ed Lag
(ARDL), Canonical Coin eg a ion Reg ession (CCR), and Fully Modi ied Leas Squa e (FMOLS) models.
These me hodologies enable us o accu a ely assess he sho - and long- e m ela ionships be ween a i-
ables. This s udy p o ides a comp ehensi e analysis o how globaliza ion and he adop ion o enewable
ene gy in e ac o in luence ca bon emissions in Somalia. Addi ionally, we examine he dynamics o eco-
nomic g ow h and domes ic in es men , emphasizing he impo ance o sus ainable g ow h s a egies
ha p io i ize clean ene gy and g een in es men s. Ou esea ch unde sco es he signi icance o di ec -
ing in es men s owa ds enewable ene gy p ojec s and sus ainable de elopmen ini ia i es, o e ing
aluable insigh s o policymake s and s akeholde s in Somalia.
2. Me hodology
2.1. Da a
The s udy’s annual ime se ies da a spanned om 1990 o 2020, wi h sample obse a ions de e mined by
da a a ailabili y. Da a we e sou ced om he Wo ld Bank, he O ganiza ion o Islamic Coope a ion (OIC),
and he KOF Swiss Economic Ins i u e. The da ase comp ised En i onmen al deg ada ion, Globaliza ion,
Renewable ene gy, Economic g ow h, and Domes ic in es men (see Table 1 o mo e de ails).
2.2. Econome ic modeling
In his s udy, we u ilized se e al s eps o empi ically in es iga e he impac o enewable ene gy and
globaliza ion on en i onmen al deg ada ion. By employing EViews 12, ou s udy u ilizes he Augmen ed
Dickey-Fulle (ADF) es o assess he s a iona i y p ope ies o he da a. S a iona i y is a c ucial assump-
ion in ime se ies analysis, as i ensu es ha he s a is ical p ope ies o he da a emain consis en o e
ime. In addi ion, he s udy u ilized he ARDL model, FMOLS, and CCR app oaches o accomplish ou
esea ch objec i es. The ARDL me hod demons a es supe io pe o mance in si ua ions wi h limi ed
sample sizes, making i pa icula ly sui able o small-scale obse a ions (Nko o & Uko, 2016). Mo eo e ,
i can accommoda e se ies ha exhibi di e en le els o in eg a ion, whe he a le el, i s -di e ence, o
a combina ion o bo h. Finally, he ARDL me hod allows o he simul aneous es ima ion o sho - and
long- un coin eg a ion wi hou comp omising he accu acy o long- e m esul s (Chandio e al., 2018).
This me hodological amewo k enables he in es iga ion o he in e connec edness among en i onmen-
al deg ada ion, globaliza ion, enewable ene gy, economic g ow h, and domes ic in es men . The
ends o he in e es ed a iables a e depic ed in Figu es 1.
LnED ¼b0þb1LnGI þb2LnREC þb3LnEG þb4LnDI þe (1)
The equa ion inco po a es se e al independen a iables and one dependen a iable, each ans-
o med using he na u al loga i hm, ep esen ing di e en aspec s o he economic con ex unde s udy.
These include LnED_ (En i onmen al Deg ada ion), LnGI_ (Globaliza ion), LnREC_ (Renewable Ene gy),
LnEG_ (Economic G ow h), and LnDI_ (Domes ic In es men ) These ans o ma ions acili a e a mo e
explici in e p e a ion o he ela ionship be ween a iables, especially when he ela ionship is mul i-
plica i e a he han addi i e.
Table 1. Va iables desc ip ions.
Va iables Code Measu emen Sou ces
En i onmen al Deg ada ion ED Ca bon emissions (k ) Wo ld Bank
Globaliza ion GI Globaliza ion Index KOF
Renewable Ene gy REC Renewable Ene gy Consump ion SESRIC
Economic G ow h EG G oss Domes ic P oduc Pe Capi a (Cons an , 2015) SESRIC
Domes ic In es men DI G oss ixed capi al o ma ion (Cons an , 2015) SESRIC
4 O. A. HUSSEIN AND K. S. MOHAMED
The coe icien s b_1, b_2, b_3, and b_4 quan i y he es ima ed e ec s o hese independen a iables
on he dependen a iable, which measu es he e ec s o a one pe cen change in Globaliza ion,
Renewable Ene gy, Economic G ow h, and Domes ic In es men on En i onmen al Deg ada ion. The
e o e m e_ ep esen s he dis u bance a ime , encompassing ac o s no explici ly cap u ed in he
model ha in luence Economic Deg ada ion. Once s a iona i y is con i med, he ARDL model will analyze
he ela ionships be ween he a iables. Thus, Equa ion 2 can be o mula ed acco dingly.
DLnED ¼b0þb1DLnED −1þb2DLnGI −1þb3DLnREC −1þb4DLnEG −1þb5DLnDI −1þX
p
i¼1
aiDLnED −1
þX
q
i¼1
ciDLnGI −1þX
i¼1
diDLnREC −1þX
s
i¼1
hiDLnEG −1þX
i¼1
qiDLnDI þlECT −1
(2)
whe e Dis he i s di e ence ope a o ; p, q, , s, and a e he lag leng hs o each a iable, which you
can de e mine empi ically o h ough model selec ion c i e ia; b0 is he in e cep ; ECT -1 is he e o co -
ec ion e m; b
1
,b
2
,b
3
,b
4
and b
5
and a
i
,c
i
,d
i
,h
i
, and q
i
a e he long- un and sho - un coe icien s o
he model, espec i ely.
3. Empi ical esul s
3.1. Desc ip i e s a is ics
Table 2 p o ides a comp ehensi e o e iew o he a iabili y and dis ibu ional cha ac e is ics o he a -
iables unde conside a ion. Fo ins ance, he a iable en i onmen al deg ada ion demons a es mode a e
Figu e 1. T ends o in e es ed a iables.
Table 2. Desc ip i e s a is ics and co ela ion ma ix.
Desc ip i e in o ma ion LnED LnREC LnGI LnEG LnDI
Mean −0.511 4.529 3.264 21.909 6.045
Median −0.494 4.536 3.238 21.831 5.932
Maximum −0.315 4.559 3.416 22.925 6.880
Minimum −0.733 4.458 3.191 21.146 5.531
S d. De . 0.097 0.025 0.075 0.579 0.415
Skewness −0.574 −1.282 1.031 0.445 0.657
Ku osis 3.439 4.021 2.595 1.917 2.301
Ja que-Be a 1.953 9.840 5.702 2.536 2.862
P obabili y 0.377 0.007 0.058 0.281 0.239
Co ela ions
LnED 1
LnREC −0.344 1
LnGI 0.227 0.670 1
LnEG 0.263 0.769 0.892 1
LnDI 0.415 0.582 0.864 0.959 1
COGENT ECONOMICS & FINANCE 5
a iabili y. This sugges s ha en i onmen al deg ada ion alues a y mode a ely a ound hei a e age,
indica ing po en ial luc ua ions in he phenomenon i ep esen s. Con e sely, enewable ene gy exhibi s
less a iabili y wi h a mean and s anda d de ia ion, implying a mo e s able end in enewable ene gy
consump ion. Addi ionally, measu es like ku osis and skewness o e insigh s in o he shape o he dis-
ibu ions. Posi i e skewness o globaliza ion and domes ic in es men sugges s igh -skewed dis ibu-
ions, while en i onmen al deg ada ion displays a le -skewed dis ibu ion.
The Ja que-Be a es was used o e alua e he no mali y o he a iables. En i onmen al deg ada ion
globaliza ion, economic g ow h, and domes ic in es men showed p- alues g ea e han he c i ical alue,
sugges ing po en ial no mal dis ibu ion. A he same ime, enewable ene gy had p- alues below a c i ical
alue, indica ing non-no mal cha ac e is ics. Co ela ion analysis e ealed signi ican ela ionships among
he a iables. En i onmen al deg ada ion nega i ely co ela ed wi h enewable ene gy, indica ing a mode -
a e nega i e ela ionship. Con e sely, en i onmen al deg ada ion posi i ely co ela ed wi h globaliza ion,
economic g ow h, and domes ic in es men , sugges ing mode a e posi i e ela ionships wi h he global-
iza ion index, economic g ow h, and domes ic in es men . Renewable ene gy showed s ong posi i e co -
ela ions wi h globaliza ion, economic g ow h, and domes ic in es men , highligh ing obus posi i e
associa ions wi h he globaliza ion index, economic g ow h, and domes ic in es men . Addi ionally, global-
iza ion, economic g ow h, and domes ic in es men exhibi ed s ong posi i e co ela ions, indica ing sub-
s an ial ela ionships be ween globaliza ion, economic g ow h, and domes ic in es men .
3.2. Uni oo es
To asce ain non-s a iona i y, a p e equisi e o accu a e ime se ies analysis, he Augmen ed Dickey-
Fulle (ADF) uni oo es sc u inizes whe he ime se ies a iables demons a e a uni oo (Ajewole
e al., 2020). As p esen ed in Table 3, a iables such as enewable ene gy and domes ic in es men
e ince e idence agains a uni oo a he le el, whe eas en i onmen al deg ada ion, globaliza ion, and
economic g ow h do no . None heless, all a iables demons a e e idence agains a uni oo a e he
i s di e ence, signi ying pos -di e encing s a iona i y. This ans o ma ion is pa amoun in es ima ing
long- un ela ionships among a iables, ensu ing s able s a is ical p ope ies o e ime, and adhe ing o
he p inciples o Au o eg essi e Dis ibu ed Lag (ADRL) models. Once uni oo es s co obo a e s a io-
na i y o in eg a ion p ope ies, F-bound coin eg a ion es s e alua e whe he a linea combina ion o
he a iables is s a iona y, he eby indica ing a long- e m ela ionship.
As pe Table 4, he F-s a is ic o (7.83) su passes c i ical alues a he 1% signi icance le el, leading o
he ejec ion o he null hypo hesis. The ou come indica es he p esence o coin eg a ion among he a ia-
bles, implying a s able long- un equilib ium. By ac i ely iden i ying unde lying ela ionships among eco-
nomic indica o s, his es aids in accu a e o ecas ing, enhancing ou unde s anding o economic ends.
3.3. Au o eg essi e dis ibu ed lag model (ARDL)
The analysis p esen ed in Table 5 p o ides aluable insigh s in o he empo al dynamics o he ela ion-
ships be ween a iables, as illus a ed by he Long- un and Sho - un es s. In he long e m, he s udy
Table 3. ADF uni oo es .
A Le el
Va iables Wi h cons an Wi h cons an and end
LnED −2.477 −2.639
LnREC −5.950 −3.369
LnGI 0.285 −1.208
LnDI 1.262 −3.671
LnEG 0.642 −2.192
A Fis Di e ence
D(LnED) −3.261 −3.609
D(LnREC) −3.525 −3.439
D(LnGI) −4.521 −4.787
D(LnDI) −4.472 −3.788
D(LnEG) −3.784 −4.148
No e. Signi icance le els a e deno ed by ,, and , indica ing inc easing signi icance le els a 10%, 5%, and 1%, espec i ely.
6 O. A. HUSSEIN AND K. S. MOHAMED
e eals ha enewable ene gy and domes ic in es men play c ucial oles in mi iga ing en i onmen al
deg ada ion, as e idenced by hei disce nible nega i e impac . The e icacy o enewable ene gy in
educing en i onmen al ha m is pa icula ly no ewo hy, wi h a subs an ial coe icien indica ing ha a
1% inc ease in enewable ene gy leads o a signi ican dec ease o -10.4% in en i onmen al deg ada ion.
Simila ly, a 1% inc ease in domes ic in es men esul s in a subs an ial dec ease o -0.5% in en i onmen-
al deg ada ion. Con e sely, he s udy inds ha economic g ow h has a obus posi i e impac on en i -
onmen al deg ada ion, implying ha a 1% inc ease in economic g ow h con ibu es 0.76% o
en i onmen al de e io a ion. Howe e , globaliza ion’s impac on en i onmen al deg ada ion is insigni i-
can in he long un, as indica ed by a coe icien wi h a p- alue o 0.08.
Sho - e m dynamics a e elucida ed by he ini ial dispa i ies in enewable ene gy and domes ic in es -
men , mani es ed by signi ican nega i e coe icien s in he sho un. This indica es ha a 1% inc ease
in enewable ene gy and domes ic in es men leads o subs an ial dec eases in en i onmen al deg ad-
a ion, app oxima ely -11.35% and -0.37%, espec i ely. On he o he hand, globaliza ion is depic ed as
con ibu ing o en i onmen al deg ada ion in he sho e m, indica ing a 0.38% impac on en i onmen-
al deg ada ion. Fu he mo e, he E o Co ec ion Model (ECM) coe icien om he an eceden pe iod,
cha ac e ized by a subs an ial nega i e coe icien o -0.462 and a p obabili y alue o 0.000, elucida es
he swi ness wi h which he sys em e u ns o long- un equilib ium ollowing a dis u bance.
The analysis also highligh s ema kable ela ionships be ween enewable ene gy consump ion, eco-
nomic g ow h, and domes ic in es men in he sho and long un. The model’s ele a ed R-squa ed
alue o 0.889 indica es ha he independen a iables can explain a subs an ial p opo ion o he a i-
abili y in he dependen a iable. These indings a e o g ea alue, as hey unco e ansien dynamics
and endu ing equilib ium ela ionships among a iables, which a e essen ial o e ec i e policymaking
and accu a e economic p ognos ica ion.
Fu he mo e, he diagnos ic checks conduc ed on he model indica e ha i sa is ies he assump ions
o no mali y, absence o au oco ela ion, and he e oskedas ici y p oblems; hese indings con i m he
model’s sui abili y. S abili y analysis, pa icula ly c ucial o ime-se ies da a, assesses da a consis ency
o e ime. I demons a es he a ia ions in da a ha occu wi hin a speci ied ime ame. The CUSUM
and CUSUMSQR es s o Figu e 2 and 3a e aluable ools o de e mining a iance and showcasing da a
Table 5. Long un and sho un e ec s.
Long un impac
Va iable Coe icien P ob
LnREC −10.401 0.000
LnGI −0.4920.086
LnEG 0.758 0.000
LnDI −0.501 0.003
Sho un impac
D(LnREC) −11.352 0.000
D(LnGI) 0.383 0.026
D(LnDI) −0.377 0.000
ECM (-1) −0.462 0.000
Diagnos ic check Value P obabili y
Ja que-Be a No mali y es 0.849 0.653
B eusch-God ey Se ial Co ela ion Tes 0.003 0.9529
B eusch-Pagan He e oskedas ici y Tes 6.475 0.594
R2 0.889
No e. ,, and ep esen signi icance a 10%, 5%, and 1% wi hin s a is ical analysis.
Table 4. F-bound coin eg a ion es .
F-bounds es Null hypo hesis: no le els o ela ionship
Tes s a is ic Value Signi ican I(0) I(1)
F-s a is ic 7.832 1% 3.74 5.06
K 4 5% 2.86 4.01
10% 2.45 3.52
No e. deno es le els o signi icance a 1%.
COGENT ECONOMICS & FINANCE 7
