Assessing the impact of fiscal policy and natural resources on environmental degradation in BRICS countries: A resource management perspective

Abstract

This study examines the effects of fiscal policy, human capital, natural resources, and energy productivity on the load capacity factor (LCF) in BRICS countries between 1990 and 2018 in order to meet the COP27 goal of promoting environmental sustainability. The dynamic common correlated effects mean group (CCEMG) estimator revealed the long-term effect, showing that fiscal policy, energy production, and human capital contribute to the LCF, but natural resources mitigate the LCF. On the flip side, the results of the panel causality test show that LCF may be predicted by energy productivity and human capital. The causality results reveal that LCF can forecast fiscal and natural resource policies. On the basis of the findings, significant policy suggestions are provided, including the public investment that may be directed towards the development of green industrial methods and the revision of the policies connected to exploring these natural resources, particularly fossil fuels.