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Key drivers of renewable energy deployment in the MENA Region: Empirical evidence using panel quantile regression

Belaid, F. and Elsayed, A. and Omri, A. (2021) 'Key drivers of renewable energy deployment in the MENA Region: Empirical evidence using panel quantile regression.', Structural Change and Economic Dynamics, 57 . pp. 225-238.

Abstract

With the growing pressure from the adverse impact of environmental pollution and climate change, the deployment of renewable sources is becoming one of the economic priorities for governments worldwide. Despite potential gains of renewable sources, little evidence is provided in the literature about the determinants of renewable energy deployment in the MENA region. In particular, whether political stability, governance quality and financial development matter or not for unleashing the potentials of renewable energy programs. To this end, this paper aims to fill the gap by examining the impact of political stability, quality of governance and institutions, and financial development on the deployment of renewable energy production in 9 selected MENA countries using annual data over the period 1984-2014. Accordingly, an innovative panel quantile regression model with non-additive fixed effect has been developed to tackle this issue. Our findings confirm that the effect of political stability is clearly heterogeneous and supports earlier claims about the importance of political stability to foster investments in the renewable energy sector. Findings also show that financial development has a positive impact on renewable energy production. In addition, we also find that the interaction term between governance effectiveness and financial development is negative for the lower quantiles but positive for the highest quantiles. These findings support our hypotheses and suggest that political stability, governance effectiveness, and financial development are essential drivers for promoting renewable energy production in the MENA region.

Item Type:Article
Full text:Publisher-imposed embargo until 26 March 2023.
(AM) Accepted Manuscript
Available under License - Creative Commons Attribution Non-commercial No Derivatives 4.0.
File format - PDF
(704Kb)
Status:Peer-reviewed
Publisher Web site:https://doi.org/10.1016/j.strueco.2021.03.011
Publisher statement:© 2021 This manuscript version is made available under the CC-BY-NC-ND 4.0 license http://creativecommons.org/licenses/by-nc-nd/4.0/
Date accepted:19 March 2021
Date deposited:08 April 2021
Date of first online publication:26 March 2021
Date first made open access:26 March 2023

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