Green growth through green production practices: The moderating role of stringent environmental policies in G8 countries

Green growth (GGDP) is currently regarded as one of the most effective alternative approaches to sustainable development. The global economy must undergo a green revolution. Green total factor productivity assesses a nation or region's capacity to meet long-term targets for sustainable development. Even though environmental technologies are essential to green growth, more research is needed to close the significant gap by determining whether and how green production practices (GPP) along with stringent environmental policy (EPS) impact green growth in a panel of G8 economies. The study also takes into consideration the impact of capital formation (CAP), labor (LAB), and renewable energy consumption (REC) on the green growth of G8 economies. The study used annual data covering 1990–2020 and employed a panel quantile regression (PQR) technique. The empirical results of Model 1 of the study showed a negative association between GPP and GGDP. On the contrary, in model 2, green production practices (GPP) positively correlate with green growth (GGDP) when moderated with environmental policy stringency. Likewise, the findings also confirm that labor has a positive impact on green growth. Furthermore, the empirical result also shows that capital and renewable energy consumption harm GGDP. The study suggests a comprehensive policy framework based on empirical analysis for achieving the targets of sustainable development goals SDG 08 (decent economic growth), SDG 09 (innovations), and SDG 13 (climate change).

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