Renewable energy consumption and local environmental effects for economic growth and carbon emission: evidence from global income countries.

The use of renewable energy improves environmental quality by reducing carbon emission and influence economic growth where carbon emission also affect economic growth of a country. The economic theory of tourism also indicates that tourism development enhances economic growth through spillovers as well contributes to climate change. Financial development enhances economic growth; however, it also affects environmental quality. Based on the ongoing debate, the present research attempts to explore the effect of renewable energy consumption, tourism and financial development on economic growth and carbon emission in global income countries to know whether these impacts are the same globally for the low-income and high-income countries. Using panel data for the global panel, high-income and low-income countries for the period of 2002-2019, the results indicate that all variables affect economic growth and carbon emission significantly. Three common factors TORR, FDT and TO significantly increase economic growth while decrease carbon emission. Renewable energy and TORA also reduce emission, while TORX, FDB and economic growth are the drivers of carbon emission; however, this effect varies in different income countries. The results evidence the environmental Kuznets Curve hypothesis only in high-income countries. These results suggest that enhancing tourism and financial development mitigates emission level and enhances economic growth; however, renewable energy consumption reduces both. The study has shown that these variables are not the same as the economic growth and emission levels of different income groups are not the same, but it changes. In addition, the foundation of this study has a great deal of recommendations for income group economic and environmental decision make-up.