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The Interaction Effect of Green Technologies and Financial Development on the Environmental Load Capacity Factor in Iran:
A Novel Approach of Fourier Bootstrap ARDL
and Fourier Bootstrap Granger Causality
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Abolghasem Golkhandan *   |
| Department of Economic, Lorestan University, Khoram Abad, Iran. , golkhandana@gmail.com |
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Abstract: (2 Views) |
| This study examines the impact of green technologies, financial development, and their interaction on Iran’s Environmental Load Capacity Factor (LCF) during 1990–2022. LCF is calculated as the ratio of ecosystem biocapacity to ecological footprint and serves as an indicator of environmental sustainability. To analyze these relationships, the Fourier-based Autoregressive Distributed Lag (F-ARDL) model and the Fourier Toda–Yamamoto (F-TY) causality test, both bootstrap-based, were employed. The findings reveal that the long-term effect of financial development on LCF is nonlinear and depends on the level of green technologies. Specifically, as green technologies advance, the negative impact of financial development on environmental quality diminishes. Moreover, a causal relationship from green technologies and financial development to LCF is confirmed. Results also indicate that energy consumption has a significant negative effect on LCF, supporting the Load Capacity Curve (LCC) hypothesis for Iran. The robustness of these results was validated through alternative green technology indices and estimation methods. Consequently, the study suggests that expanding environmentally friendly technologies through financial instruments and increasing investment in ecological initiatives can enhance environmental sustainability in the country. |
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| Keywords: Green Technologies, Financial Development, Load Capacity Factor, Interaction Effect, Fourier ARDL, Iran |
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Full-Text [PDF 985 kb]
(2 Downloads)
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Type of Study: Research |
Subject:
General
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