EXPLORING THE IMPACT OF EXPORTS ON CLEAN ENERGY CONSUMPTION IN CHINA: AN EMPIRICAL STUDY

Abstract

Understanding the influence of export volume in improving a country's clean energy consumption requires a systematic search method to characterize the crucial role to ensure environmental sustainability. The present study employed an autoregressive distributed lag (ARDL) bounds testing approach and vector error correction model (VECM), by using data from 1985-2018. The analysis revealed that in the long-run an increase in exports per capita and technological innovation can enhance clean energy consumption, and overcome environmental issues. Surprisingly, economic growth does not display significant effect. In the short run technological progress reduces clean energy consumption. The outcome of causality tests reveals a unidirectional from technological innovation to clean energy consumption in the short term. Along similar line, the results prove a feedback link among exports per capita and clean energy consumption, indicating that an increase in exports per capita is a core factor driving and improve energy use, among technological innovation and clean energy consumption, and among economic growth and clean energy consumption in the long run. To enhance clean energy and enable success in environmental improvement, policymakers in China should take proper initiatives to increase the clean trade, adjust the export pattern, and patent incentive technology, to ensure sustainable economic development.