Should Asia Pacific Economic Cooperation Countries Put all their Eggs in one Energy Basket? Examining the Linkage between Energy Diversification and Sustainable Development

Abstract

Energy diversification is critically important from an economic, political and environmental point of view. In this research, we try to investigate the role of energy diversification for sustainable development in Asia Pacific Economic Cooperation or APEC member countries. We utilize data from different sources which range from 1990 to 2020. Apart from energy diversification, other independent variables such as public sector corruption, ICT, economic globalization and social globalization are utilized according to the theory and empirical literatures which utilize these parameters in order to see how growth or environment of an economy is affected. The study implements second generation econometric methodologies in order to tackle the cross sectional dependence issue among the countries. The result reveals that energy diversification positively and significantly affect sustainable development in APEC nations. ICT and economic globalization were also found to be positively affecting the sustainable development. However, social globalization negatively affected the sustainable development while the effect of public sector corruption was not significant. Bidirectional causality was revealed between sustainable development and energy diversification. The study recommends diversifying energy sources for achieving the sustainable development goals (SDGs) agenda for these economies. © 2023 Elsevier Ltd