Greening Economic Growth: The Role of Renewable Energy and Agricultural Land Use in Carbon Emission Mitigation

Abstract

Climate change and rising carbon dioxide (CO₂) emissions pose significant challenges to environmental sustainability, particularly in developing and emerging economies experiencing rapid economic growth and increasing energy demand. Against this backdrop, this study investigates the relationships between economic growth, renewable energy consumption, agricultural land use, and CO₂ emissions across 34 Belt and Road Initiative (BRI) countries over the period 1988–2020. Using panel data obtained from the World Development Indicators (WDI), the study employs pooled ordinary least squares (OLS), fixed effects (FE), two-step difference generalized method of moments (GMM), and two-step system GMM estimators. These approaches provide baseline estimates, account for unobserved country-specific heterogeneity, and address potential endogeneity and the dynamic persistence of carbon emissions. The empirical findings from the dynamic panel estimators reveal that economic growth is positively associated with CO₂ emissions, whereas renewable energy consumption and agricultural land use exhibit significant negative associations. Furthermore, the results do not support the conventional inverted U-shaped environmental Kuznets curve (EKC) hypothesis, suggesting that economic development alone does not necessarily lead to reduced carbon emissions in the sampled countries. These findings highlight the importance of integrating environmental sustainability into economic development strategies. The study emphasizes the need to accelerate renewable energy adoption, promote sustainable agricultural land management, improve energy efficiency, and encourage investment in low-carbon technologies. These policy measures could contribute to reducing carbon emissions while fostering environmentally sustainable economic growth across BRI countries.