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. 2024 Jan 5;19(1):e0296363.
doi: 10.1371/journal.pone.0296363. eCollection 2024.

Macroprudential policies and CO2 emissions: A comparative analysis of G7 and BRIC countries

Heng Luo  1   2 , Fakarudin Kamarudin  2
Affiliations

Macroprudential policies and CO2 emissions: A comparative analysis of G7 and BRIC countries

Heng Luo et al. PLoS One. .

Abstract

This study investigates the impact of macroprudential policies on CO2 emissions in G7 and BRIC countries using country-level panel data from 11 countries, covering the period from 1992 to 2020. The findings indicate that macroprudential policies alleviate CO2 emissions in the sample. Quantile regression results reveal that policies can exacerbate CO2 emissions in countries with high levels of CO2 emissions due to carbon leakage. The positive impact of macroprudential policies on sustainable development can be strengthened by high level of globalisation. Moreover, the influence of macroprudential policies stayed the same based on the basic regression results during the post-global financial crisis (GFC) period, while the impact was positive in the pre-GFC period. Finally, robust tests validated the findings reported in the basic regression model. From this, policymakers should prioritise sustainable economic growth when implementing macroprudential policies and leverage the influence of globalisation to amplify their impact on CO2 emissions. Furthermore, it is crucial to strengthen environmental regulations to prevent carbon leakage that result from industries seeking lenient standards.

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Conflict of interest statement

The authors have declared that no competing interests exist.

Figures

Fig 1
Fig 1. Share of BRIC and G7 countries in global CO2 emissions (kt) in 2020.
(Data Source: World Development Indicators (WDI)).
See this image and copyright information in PMC

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