Green Innovation and Green Economic Growth in Regional Comprehensive Economic Partnership (RCEP) Countries: Moderating Effect of Financial Development
DOI:
https://doi.org/10.22452/JIE.vol18no3.7Keywords:
Green innovation, Financial development, Green economic growth, Regional Comprehensive Economic Partnership countries, Two-way fixed effectsAbstract
This study examines the relationship between green innovation and
green economic growth in Regional Comprehensive Economic Partnership (RCEP)
member countries from 2000 to 2021, with a focus on the moderating role of financial
development. Using a two-way fixed effects (TWFE) model, the analysis reveals that
green innovation significantly enhances green economic growth by improving production
efficiency and reducing reliance on resource-intensive industries. Financial development
amplifies this effect by optimising resource allocation and providing long-term capital
support. These findings are confirmed by robustness tests, highlighting the critical role
of financial development in maximising the benefits of green innovation. In addition, the
contributions of human capital, research and development (R&D) personnel, and clean
energy production are discussed. A well-educated workforce accelerates the adoption of
green technologies, R&D personnel drives their innovation and industrilialisation, and
clean energy production reduces fossil fuel dependency, laying a stable foundation for
sustainable growth. Accordingly, policies that strengthen financial systems, incentivise
green R&D, and promote regional cooperation are essential to achieving sustainable
economic growth in RCEP countries.
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