ICT-environmental policy synergies for green trade and emissions reduction: an SDGs nexus analyses in OECD countries

Abstract

The Sustainable Development Goals (SDGs) represent a universal call to action, yet progress remains uneven across goals and regions, underscoring the need for policies that advance multiple targets simultaneously. This study examines how Information and Communication Technologies (ICT) infrastructure (SDG-9) affects green trade development, and how this effect, in turn, translates into reduced CO2 emissions (SDG-13). We argue that green trade development operates as the mediating mechanism linking digital infrastructure to environmental outcomes, and we test whether stringent environmental regulations (SDG-12) moderate, specifically strengthen, the ICT-green trade relationship. Using Pooled Mean Group (PMG) and fixed effects estimation with Driscoll-Kraay Standard Errors on a panel of OECD countries from 2002 to 2021, we find that ICT penetration significantly enhances green trade development, and this effect is amplified in the presence of more stringent environmental regulations. In turn, higher green trade development is associated with lower CO2 emissions, confirming its mediating role between ICT infrastructure and environmental performance. Together, these findings support a pathway of 'digital ecological modernization', in which ICT infrastructure investments (SDG-9), reinforced by environmental regulations (SDG-12), drives green trade development as a mechanism for achieving emissions reduction (SDG-13). The results suggest that coordinating digital and environmental policy can generate multiplier effects across interconnected SDGs.