The Nexus between National Governance, Renewable Energy, and Ecological Footprints: Evidence from the Chinese Economy

Abstract

This study examines how China’s ecological footprint is impacted by national governance and renewable energy. We employ two distinct statistical methodologies to capture the effect of regressors on the dependent variable. The results of Fully Modified Ordinary Least Square (FMOLS) and Dynamics Ordinary Least Square (DOLS) are obtained after the idea of the existence of co-integration among the variables by the Ordinary Least Square (OLS) method. The empirical findings reveal that national governance and renewable energy consumption significantly reduce ecological footprints in the context of China. Since the national governance is represented by the control of corruption, government effectiveness, rule of law, and regulatory quality, all these variables were found to be negatively associated with the ecological footprint. These results suggest that improved governance and quality regulations can significantly lower the environmental degradation and ecological footprint in China. Moreover, a positive linkage between GDP and ecological footprint implies that economic growth has come at the cost of environmental deterioration. Therefore, it is essential to maximize the use of renewable energy to fuel economic growth, which will help in pollution abatement and preserve the environment.