Do financial incentive policies for renewable energy development increase the economic growth in Latin American and Caribbean countries?

ABSTRACT

This investigation approached the impact of financial incentive policies for renewable energy development on economic growth using panel data with seventeen countries from Latin America and the Caribbean (LAC) from 1990 to 2016. The fixed-effects model (FE) and the quantile via moments (QvM) models were used to accomplish this investigation. The FE and the QvM models showed that the financial incentive policies for renewable energy development and consumption of green energy, public and private capital stock, and globalisation increase economic activity in the countries from the LAC region, while gender inequality reduces it. Indeed, the positive impact of financial incentive policies for renewable energy development and consumption of green energy on economic growth could be related to the possible capacity of these policies to encourage investments in green energy technologies and the consumption of green energy.

KEYWORDS:

• Capital stock
• economic growth
• financial incentive policies
• globalisation
• Latin America & the Caribbean region
• renewable energy

Acknowledgements

CeBER R&D unit funded by national funds through FCT – Fundação para a Ciência e a Tecnologia, I.P., project UIDB/05037/2020. Emad Kazemzadeh thanks the Faculty of Economics of the University of Coimbra for the host and resources for carrying out this research.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Ethical approval

This article does not contain any studies with human participants performed by any of the authors.

Authors contributions

Matheus Koengkan: Conceptualisation, Methodology, Writing – Original draft preparation, Supervision, Validation, Data curation, Investigation, Formal analysis, Visualisation.

José Alberto Fuinhas: Conclusions, Reviewing and Editing.

Emad Kazemzadeh: Literature review.

Additional information

Funding

This work was financially supported by the research unit on Governance, Competitiveness and Public Policy, UIDB/04058/2020 and UIDP/04058/2020, funded by national funds through FCT-Fundação para a Cie^ncia e a Tecnologia; and by the CeBER R&D unit, funded by national funds through FCT-Fundação para a Ciência e a Tecnologia, I.P., project UIDB/05037/2020.