Unlocking green potentials for carbon neutrality in OECD countries

Abstract

This study investigates strategies for achieving carbon neutrality within OECD countries, acknowledging their significant contribution to global carbon emissions. Employing advanced econometric techniques, including panel-corrected standard error (PCSE), instrumental variables generalized method of moments (IV-GMM), and quantile regression, it analyzes the impact of green transitions on carbon neutrality from 2000 to 2020. Results reveal that green transitions play a crucial role in achieving carbon neutrality, with varied effects based on different indicators and quantiles. The study emphasizes a multifaceted approach, advocating for the advancement of green policies, political strategies, technological innovations, and financial mechanisms concurrently. By addressing issues such as cross-sectional dependence, heteroscedasticity, endogeneity, and heterogeneity, this study contributes to a deeper understanding of the direct effects of transitions and green indicators on the path toward carbon neutrality in OECD countries. Its findings aim to guide policymakers toward more efficient and tailored sustainability efforts.