According to International Energy Agency (2020), energy consumption has increased to 14,421 Mtoe in 2020, which is 3.2 per cent higher than in 2017. This increase is due to a higher dependency on fossil fuels across the globe. Fossil fuels contribute 81 per cent to the production process. However, renewable energy consumption also increased to 60 Mtoe in 2018. Renewable energy covers 17 per cent of energy consumption and is predicted to increase further to 85 per cent by 2050. Carbon dioxide emissions are also increasing and contributing negatively to environmental quality (IPCC, 2020). In this context, the share of Carbon Dioxide emissions of the Organization for Economic Co-operation and Development (OECD) accounted for 37.2 per cent, higher than the European Union and other economies. Therefore, reducing CO2 emissions for the OECD and other economies are essential for a better climate and sustainable development policies. Economic globalization (s) impact on energy consumption patterns for 24 OECD economies from 1995 to 2015 is analysed as this thesis’s first objective. We employ Westerlund cointegration (2007), which shows a long-run association between economic globalization and energy consumption patterns. Furthermore, the Chudik and Pesaran (2015) Cross-Sectional ARDL (CS-ARDL) results explain the short-run and long-run relationship between the series. Our results further clarify that economic globalization (s) reduces oil and coal consumption while accelerating gas consumption in the OECD economies. We additionally employ the Eberhardt (2012) Augmented Mean Group (AMG) test to verify consistency with the CS-ARDL results. This thesis’s second objective analyses the relationship between economic globalization and CO2 emissions for the OECD economies from 1970 to 2015. We use three definitions of economic globalization such as classic, reconstructed and revisited economic globalization. The relationship between economic globalization and CO2 emissions is established along with real GDP, population and foreign direct investment. We use the stochastic impact of regression on population, affluence, and technology (STRIPAT model) to explain the effects of technology and growth on economic globalization and CO2 emissions interlink. Econometric models such as Newey and West (1987) and Driscoll and Kraay (1998), Panel Correlated Standard Error (PCSEs) and Feasible Generalized Least Squares (FGLS) are employed to explain our hypotheses. Our empirical estimates suggest that the growth effect and population are essential factors positively influencing environmental quality while technological effects improve environmental quality. We also employ Eberhardt (2012) Augmented Mean Group (AMG), Pesaran (2006) Common Correlated Effects Mean Group estimator (CCEMG) and Kernel-based regularized least squares (KRLS) to explain the long-run relationship between variables. Our results are consistent with the earlier estimates. This thesis’s third objective analyses the impact of globalization (s) on renewable energy consumption in OECD countries by endogenizing per capita GDP, oil prices, and per capita carbon emissions. We use robust globalization (s) as measured by the “classic”, “reconstructed”, and “revisited” globalization indexes. The novel method of Machado and Silva Panel quantile regression (2019) approach is used to obtain robust findings for the renewable energy consumption-globalization nexus.
The empirical evidence of this study suggests that the OECD economies’ policymakers should prioritize economic globalization (s) in framing policies related to energy consumption. Further, allocating funds for better technology related to high polluting fuels should be one of the crucial considerations arising from this study. Finally, we recommend economic globalization (s) as an essential indicator to address the issues related to OECD economics’ environmental and ecological footprints. Technology improvement and economic globalization are crucial factors in driving the environmental quality for the OECD economies. Hence, international and national policies must aim at improving technological efforts and economic globalization. The results confirm the presence of a long-run association between renewable energy consumption with globalization (s), per capita GDP, oil prices and per capita carbon emissions. The empirical results also describe positive effects for per capita income, the real price of oil and carbon emissions per capita on renewable energy consumption. In addition, a higher level of (overall, economics, social and political) classic globalization promotes renewable energy consumption. In contrast, the “reconstructed” and “revisited” economic globalization reduces the use of renewable energy consumption, and this finding is also robust to different measures of economic globalization.

Keywords: Economic globalization; Energy; Environment; OECD Economies​