Renewable Energy and Human Capital in Environmental Sustainability: Comparison
Please note this is a comparison between Version 2 by Camila Xu and Version 1 by Olimjon Saidmamatov.

Environmental sustainability concerns are growing worldwide. Reducing carbon dioxide (CO2) emissions is crucial to combating global warming and reaching sustainable global economic development.

  • renewable energy
  • human capital
  • government effectiveness
  • economic development

1. Introduction

Due to human activities, the concentration of carbon dioxide in the atmosphere has reached dangerous levels [1]; consequently, this increase contributes to the frequency and intensity of extreme events [2]. The Paris Agreement, a legally binding international agreement [3] on climate change adopted in 2016 by 196 countries to limit global warming to well below 2 °C or 1.5 °C, has been a key mitigation strategy [1,4][1][4]. In order to achieve this goal, it is important to focus on reducing environmental degradation, in particular reducing carbon emissions [2,3][2][3]. In the literature, economic growth, trade openness, industrialization, foreign direct investment, and emission taxes have mainly been studied as factors impacting on reducing environmental degradation [4,5,6][4][5][6]. However, despite its significance, little is understood about how environmental sustainability is attained and how human capital development helps to lessen environmental damage. Human development is relevant in the context of environmental sustainability, since any kind of mitigation measures need human comprehension of the environment, climate change, and its effects [7]. It is known that human development and a healthy lifestyle depends on education, which increases people’s responsibility for environmental sustainability and teaches them how to protect their surroundings [8]. People with higher levels of education and skill are more likely to follow environmental legislation [9].
In the new millennium, the biggest threat to every nation on the planet is climate change. In order to truly address the global environmental challenge posed by the need to reduce global CO2 output, there must be a global response; otherwise, the ongoing upward trend in CO2 emissions will only worsen [10]. There are many different causes of excessive carbon emissions. According to research by the World Health Organization, aggravating outdoor air pollution results in around 4.2 million premature deaths year [11]. According to the International Energy Agency (IEA), worldwide CO2 emissions from energy sources have stabilized at approximately 33 billion tons in 2019, nearly unchanged from the previous year [12], following a two-year rise. A one-year CO2 emission freeze, however, does not signify that global emissions have peaked, given that the global GDP decreased during the COVID-19 epidemic shutdowns that impacted numerous economies. But it is an indication that the economies of the world can trust that reducing global warming would increase the likelihood that future economic output and human well-being will not reach catastrophic levels [13]. The rise in the use of green fuel sources for the production of electricity has contributed to a reduction in the global expansion of emissions. For instance, the IEA discovered that, compared to 2018, there was an approximately 200 Mt decrease in global CO2 emissions due to a decrease in the use of coal to generate power globally in 2019.
Natural resources, economic growth, and their impact on Central Asia’s environmental quality are all available in the literature. Few of them, nevertheless, looked at how human capital affected the Eurasian territory from the nexus viewpoint. Environmental degradation has already become a global problem in the world both in developing and developed countries. There are several factors that have a relationship with CO2, such as economic development, renewable and no-renewable energy, government effectiveness, human capital, and others. A few examples of the things that are at risk from climate change are the health of people and animals, the security of food and water, and the stability of the economy. Renewable energy has emerged as a crucial weapon in the fight against this global issue and is starting to take center stage in the transformation of energy systems. The need for energy consumption in all its forms has been seen as a necessary complement to other factor inputs, like labor and capital, in the economies’ production processes [14]. According to the International Energy Report, if decisive actions are not implemented, energy-related CO2 emissions would quadruple by 2050, and rising trends in oil demand will exacerbate the problems with energy security and postpone one of the most important SDGs (Sustainable Development Goal 13) [12]. It is significant to note that, despite the sector’s remarkable growth, notably for solar and wind power, the share of REC in total energy consumption has increased very slightly in recent years. With a relative contribution of 54% for hydroelectricity and 26% for wind energy, respectively, the renewable portion of global power generation is anticipated to rise from 18% in 2007 to 23% in 2035, and it means that renewable energy consumption is believed to be one of the main factors of decreasing carbon dioxide emissions [15].
As the world is becoming more concerned about environmental sustainability, CO2 emissions indicators have been the subject of numerous recent studies, but the connection with human capital has received less attention. The link between human capital and CO2 emissions has been found to be negative at the microlevel through a number of routes. The innovative technologies and emission-reducing approaches in the manufacturing industry are introduced by more qualified and educated people [16]. As human capital and environmental degradation are more likely to be long-term oriented, more human capital-rich firms are better suited to promote sustainable development [17]. As a result, industrial firms typically have more stringent pollution controls and larger human capital reserves. Additionally, it is less probable that they will disregard outside environmental regulations. The contribution of human capital to environmental deterioration is substantial since education modifies people’s attitudes towards the environment and enables them to make positive changes to it; highly educated households appreciate the environment significantly more than less educated or illiterate households [18]. Furthermore, households with higher levels of education are more likely to prefer energy-efficient home equipment [12,19][12][19] and minimize energy consumption overall [20]. However, because there are so many opposing ways that human capital could affect CO2 releases, the macro-level relationship between it and CO2 emissions is more complicated. It has been noted that there are three different ways that physical capital, wealth, and technology may all have an impact on environmental quality [21]. The link between human capital and CO2 emissions may be mediated by economic development.

2. Renewable Energy and CO2 Emissions

It is widely accepted that boosting the use of renewable energy is a useful strategy for encouraging the reduction of CO2 emissions. Consuming energy from renewable sources has thus emerged as one of the most effective substitute tactics for sustainable growth [22]. Seven East African countries (EACs) have had their asymmetric relationship between CO2 emissions and renewable energy, as well as their economic and population growth, examined at the regional and national levels. The results show that the consumption of renewable energy has a negative impact on CO2 emissions [23]. In response, ref. [24] examined the asymmetric relationship between CO2 emissions and solar energy consumption in the top ten solar-consuming nations, highlighting the need to integrate renewable energy sources for environmental quality and sustainable growth.
In the Portugal example, ref. [25] used wavelet analysis to support the idea that using renewable energy can reduce CO2 emissions over the medium and long term in the nation. Additionally, ref. [22] uses the 3SLS model to perform an empirical investigation on the relationships between the BRICS countries’ real output, consumption of renewable energy, and CO2 emissions (apart from Russia). Notably, ref. [26] uses the Dumitrescu–Hurlin test for the next 11 countries to find a bidirectional causal relationship between CO2 emissions and renewable energy. Similarly, in the 39 developing countries that were chosen, ref. [27] demonstrated through the use of the Environmental Kuznets curve (EKC) hypothesis that the use of renewable energy sources significantly lowers emissions over time. Accordingly, ref. [28] studied this relationship in Uzbekistan, as the country’s economy highly depends on non-renewable energy (97.3%). Ref. [29] raised the unidirectional causal effect between the consumption of hydropower (renewable) energy and CO2 emissions per capita, recommending to lower CO2 emissions through the implementation of effective carbon price laws and the participation of the private sector in renewable energy projects.

3. Human Capital and CO2 Emissions

Increasing education is essential to halting environmental deterioration and maintaining the viability of economic growth. Ref. [30] makes the case that human capital levels influence how economic development affects CO2 emissions. Ref. [31] investigated the possibility that increases in human capital are linked to better environmental quality through lower CO2 emissions. However, ref. [32] pointed out that human capital can inversely regulate the impact of CO2 emissions and that internet usage is one of the key drivers of the development of a low-carbon economy.
Ref. [33] investigates the relationship between human capital and CO2 emissions in the economies of Brazil, Russia, India, China, and South Africa (BRICS). It finds that improvements in education have a long-term beneficial effect on CO2 emissions, while long-term negative changes in education have an adverse effect. Similarly, ref. [34] demonstrated that in the BRICS nations, renewable energy lowers emissions and restores environmental sustainability. According to [35], the Belt and Road countries stand to benefit greatly from technology transfer, the use of renewable energy sources, and human capital as means of reducing carbon dioxide emissions. Ref. [36] found that creative human capital reduces environmental degradation in China, suggesting that if China keeps building its creative human capital, its economic growth will eventually support environmental sustainability. In fact, ref. [37] brought up that technology greatly reduces CO2 emissions, the impact of wealth on CO2 emissions shows an inverted U-shape trend, and the population growth exacerbates CO2 emissions. Furthermore, ref. [38] examines the relationship in Central Asian states between natural resources, economic growth, human capital, and CO2 and demonstrates that, both short- and long-term, human capital has a significant and opposite association with CO2.

4. Government Effectiveness and CO2 Emissions

The interaction between institutional factors and the environment is essential to secure sustainable development. Ref. [39] raised that political stability, government effectiveness, democracy, and the control of corruption influence CO2 emissions negatively. Ref. [40] investigates the connection between carbon dioxide (CO2) emissions and five aspects of good governance—political stability, government efficacy, regulatory quality, rule of law, and corruption—in a sample of 99 developing nations. The findings confirm that, in the case of developing nations, these five factors have a negative and statistically significant correlation with CO2 emissions per capita.
In the case of South Asian countries (India, Pakistan, Sri Lanka, and Bangladesh), according to [41], a 1% increase in governance results in a 7.68% decrease in carbon emissions. As for BRICS countries, ref. [42] discovered that long-term increases in government stability, law and order, and corruption have a negative effect on carbon emissions. Through an analysis of 44 sub-Saharan African nations, ref. [43] explores the role that governance dynamics such as political stability, voice and accountability, government effectiveness, regulation quality, rule of law, and corruption-control play in moderating environmental degradation. Ref. [44] evaluated 93 emerging and developing nations, noting that those with highly effective governments saw statistically significant drops in CO2 emissions. However, as [45] point out, there can be both positive and negative effects of government effectiveness in reducing carbon emissions in both developed and developing nations.

5. Economic Development and CO2 Emissions

Environmental degradation has become one of the most worrying problems in the global setting over the last few decades. Economic development has also been the main goal of all countries since it leads to increasing the quality of living conditions, but is likewise considered as the main reason for rising CO2 emissions, which is the main factor of environmental degradation [46]. Numerous studies have examined the relationship between environmental degradation and economic development, with varying degrees of success. Ref. [47] examined the connections between CO2, renewable and non-renewable energy sources, and economic growth using data from 28 developed and developing nations. They discovered that while there is a two-way causal relationship between the consumption of renewable and nonrenewable energy in developed countries, there is no significant correlation between economic growth and energy consumption in developing countries. Research has demonstrated that in Pakistan, long-term economic growth is slowed down by positive shocks to carbon dioxide emissions, while short- and long-term growth is accelerated by negative shocks [48]. A study on the long-term cointegration relationship between China’s economic growth and CO2 emissions notes that the country’s economic growth has a strong predictive ability for CO2 emissions. In [49[49][50],50], the authors investigated the relationship between economic growth and environmental degradation in the context of Turkey, discovering that financial development and energy consumption have long-term positive and statistically significant effects on CO2 emissions, and economic expansion has a statistically significant negative impact on CO2 emissions. Ref. [51] examined the relationship between economic development and environmental degradation in Central Asian nations, finding that while trade openness and the value added of agriculture had negative and statistically significant effects on CO2 emissions in the countries under consideration, economic growth had positive long-term effects on CO2 emissions.


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