Investigating the impact of a green economy on the EKC hypothesis: Evidence from European countries

While many scholars have concentrated on the green economy and emissions, no study has yet to be conducted on the impact of the green economy on carbon emissions in European countries. This study seeks to examine the impact of the green economy on carbon dioxide emissions for European countries under the environmental Kuznets curve (EKC) hypothesis, with the gap in the literature serving as motivation. The annual data for 2012–2020 is analyzed by employing the generalized method of moments (GMM). The study’s empirical results demonstrated that green economies play a significant role in lowering carbon emissions and enhancing environmental quality in European countries. These findings are robust to the addition of the interaction effects of economic growth and green economy on the EKC for carbon emission. Economic expansion can result in decreased carbon emissions, displaying the presence of EKC when it interacts with the country’s green economy. Thus, the government should enhance investment in green economy projects that can aid in reducing carbon emissions.