Does green investment, financial development and natural resources rent limit carbon emissions? A provincial panel analysis of China.

This study investigates the role of natural resources rent, green investment, financial development and energy consumption in mitigation of carbon emissions to achieve sustainable development goal of a clean environment by using the panel data of 30 provinces of China from 1995 to 2017. This study employs novel cross-sectionally augmented autoregressive distributed lags (CS-ARDL) methodology to find the long and short-run impact of the variables of the study on carbon emission, where CS-ARDL estimates confirm the positive impact of energy consumption and financial development on carbon emissions (CO2). Moreover, green investment is negatively linked to CO2, whereas national natural resources rent is positively associated with carbon emissions. Similarly, augmented mean group and common correlated effect mean group methods provide supportive results for CS-ARDL estimates. This study recommends strengthening of national natural tax law, promotion of green investment and environmental-friendly policies to control carbon emissions.