Heterogeneous impact of industrialization, foreign direct investments, and technological innovation on carbon emissions intensity: Evidence from Kingdom of Saudi Arabia

Abstract

In recent years, policy experts have engaged in a spirited discussion over the relationship between environmental quality and energy use. This association is critical for the mitigation of climate change and achieving Sustainable Development Goals (SDGs). Furthermore, current studies have not given enough consideration to this relation, notably in the case of the Kingdom of Saudi Arabia (KSA). Therefore, this study examines the KSA case, focuses on the connection of industrialization, foreign direct investments, and technological innovation with carbon emissions intensity (CEI) by also considering urbanization and energy use, examines the period between 1991 and 2020, and uses quantile-on-quantile (QQ) regressionand quantile regression (QR) approaches for empirical examination. The empirical outcomes revealthat (i) urbanization and energy usehave an increasing impact on CEIin all quantiles; (ii) industrialization, foreign direct investments, and technological innovation have a generally decreasing impact on the CEI in most quantiles; (iii) power of the factors' impact on the CEI change according to quantiles; (iv) the robustness the findings is also validated. Hence, theresults highlight the importance of quantile-based analysis and suggest that KSA authorities need to embrace environment-friendly policies while managing environmental pollution to develop industrialization level and technological innovation as well as increase foreign direct investments.