Do geopolitical risk and economic policy uncertainty cause CO₂ emissions in BRICS? The role of institutional quality and energy productivity

In the modern era, environmental degradation emerges as a critical global issue. Extensive studies have examined numerous socio and macro-economic determinants of environmental deterioration, yet the contributions of institutional quality and energy productivity justify further investigation. To bridge this gap, the current study addresses the impacts of geopolitical risk and economic policy uncertainty, with a keen emphasis on institutional quality and energy productivity within the BRICS countries from 1992 to 2021. By utilizing advanced econometric techniques such as CS-ARDL, FMOLS, DOLS, and Augmented Mean Group, the research reveals that institutional quality and energy productivity, along with foreign direct investment, exert a mitigating effect on CO₂ emissions. However, geopolitical risk and economic uncertainty correlate with an increase in environmental degradation. In conclusion, this study offers valuable policy recommendations derived from its findings, aiming to contribute to pursuing environmental sustainability in the BRICS nations.