International Journal of Sustainable Economy (12 papers in press)

Regular Issues

• Time-frequency volatility connectedness between clean energy and commodity markets: implication for portfolio diversification under crises  
  by Mourad Mroua, Wafa Abdelmalek, Molka Khemakhem 
  Abstract: This study employs the TVP-VAR-based frequency connectedness approach to examine the volatility connectedness between regional and sectoral clean energy markets and commodity markets from January 2020 to April 2024, focusing on the COVID-19 pandemic, the Russia-Ukraine conflict, and the Israel-Palestine war. Our findings reveal that market connectedness is time-varying and significantly intensifies during extreme events, particularly during the COVID-19 pandemic. Furthermore, our findings demonstrate that long-term components predominantly drive this connectedness. While the American clean energy market serves as the primary net transmitter of volatility shocks, the Asian clean energy market consistently acts as a net receiver. Additionally, the minimum connectedness portfolio analysis suggests that incorporating clean energy and commodity assets into a portfolio effectively mitigates the risk associated with energy commodities. These key findings offer valuable insights for investors in optimizing portfolio asset allocation involving clean energy and commodity markets during crises. Moreover, they provide policymakers with crucial guidance for developing policies aimed at fostering the growth of the clean energy market.
  Keywords: clean energy; commodities; TVP-VAR frequency; minimum connectedness portfolio; COVID-19; Russia-Ukraine conflict.
  DOI: 10.1504/IJSE.2026.10071693
   
  
• Asymmetric effect of remittances on economic growth: a sectoral analysis in Nigeria  
  by Taiwo Akinlo, James Temitope Dada, Mosab I. Tabash, Mamdouh Abdulaziz Saleh Al-Faryan 
  Abstract: Nigeria receives the most remittances in Sub-Saharan Africa and ranks among the top ten globally. The government needs to capitalise on this increase in remittance inflows to promote economic growth and diversification across various sectors of the economy. Therefore, this study examines the asymmetric impact of remittances on aggregate output and sectoral growth in Nigeria from 1980 to 2022, employing both the linear and NARDL approaches. The study found that the relationship between remittances and sectors is asymmetric, except for the construction sector, which exhibits a symmetric relationship with remittance inflow. The study found that an increase in remittances benefits the economic growth, agricultural, trade, and transport sectors, while the manufacturing sector does not respond to remittance shocks. Finally, the study found that the negative shock from remittances is harmful to economic growth and the service sector. Therefore, it is expected that policymakers will introduce and implement policies to ensure the smooth inflow of remittances, promoting steady economic growth and sectoral development.
  Keywords: capital inflow; remittances; economic growth; asymmetric; real sector; agriculture; service; manufacturing; transportation; construction; Nigeria.
  DOI: 10.1504/IJSE.2026.10073647
   
  
• Triggering Sustainable Competitiveness through Institutional Quality: how Human Capital and Digitalisation Change This Game  
  by Tomáš Fišera, Bernard Vaní?ek 
  Abstract: Understanding the interplay between institutional quality, digitalisation and human capital is crucial for fostering sustainable competitiveness, particularly in light of recent global challenges. However, they are often studied separately, and there is a lack of comprehensive studies examining their interaction. This study fills this gap by analysing their direct and mediating effects in 24 EU countries (2017-2022) using PLS-SEM. While institutional quality increases digitalisation and human capital, human capital alone does not enhance sustainable competitiveness or mediate this relationship. The findings emphasise the importance of investing in digital infrastructure and institutions to better utilise human capital for more sustainable competitiveness.
  Keywords: Sustainable competitiveness; Institutional quality; Digitalization; Human capital; PLS-SEM.
  DOI: 10.1504/IJSE.2026.10074437
   
  
• Measuring the sustainable human development: evidence from different income-grouped countries using panel data  
  by Souvik Dey 
  Abstract: This scientific study develops a comprehensive framework for measuring Sustainable Human Development by analysing the interaction between human development and sustainability indicators across economies of varying income levels. Using Two-Stage Least Squares (2SLS) and multilayer canonical correlation analysis, the research addresses endogeneity concerns and identifies key sustainability factors such as internet access in schools, HIV infection rates, universal health coverage, clean cooking fuel usage, and electricity access - as critical drivers of human development. The comparison between the Human Development Index (HDI) and the proposed Sustainable Human Development Index (SHDI) reveals disparities: low-income countries show a significant lag in SHDI, middle-income countries demonstrate moderate convergence, and high-income countries exhibit high HDI but lower SHDI due to environmental costs. It can be stated that the Sustainable Human Development Index (SHDI) is a comprehensive measurement of progress than the HDI, observing the hidden gaps and emphasizing the importance of balanced development that combines economic growth with long-term social sustainability.
  Keywords: sustainability; human development index; HDI; endogeneity; two-stage least squares; 2SLS; canonical correlation; sustainable human development indicators.
  DOI: 10.1504/IJSE.2026.10075193
   
  
• Dynamic relationship between climate policy uncertainty and inflation: a time-varying Granger causality approach  
  by Opeoluwa Adeniyi Adeosun, Suhaib Anagreh, Mosab I. Tabash 
  Abstract: The study investigates the predictive relationship between US climate policy uncertainty (CPU) and four key components of inflation (energy, food, headline, and official core) utilising the rolling-window and recursive-evolving algorithms versions of Shi et al.’s time-varying Granger approach. Findings show that the CPU provides information about the future values of headline, core, and food inflation, and all inflation components exert significant predictive powers on the CPU, implying bidirectional relationships. The paper date-stamps significant periods of significant predictability, aligning with main climate-related events such as Kyoto Protocol debates, US-China climate deal, the UN climate action summit, and the Environmental Protection Agency’s GHG emissions standards. The findings are robust and consistent with the baseline results when controlling for the influence of economic policy uncertainty in the CPU-inflation nexus. The study recommends incorporating CPU into central banks’ inflation forecasting models, enhancing climate policy communication, supporting climate-resilient economic policies, and strengthening climate-related information practices.
  Keywords: climate; uncertainty; inflation; causality; forecasting; monetary; predictive linkages; non-linearity; date-stamping; policies.
  DOI: 10.1504/IJSE.2026.10075412
   
  
• Drivers of currency crises in Egypt: a political-economy approach  
  by Mona Hamdy, Mona Fayed, Asmaa Ezzat 
  Abstract: Given Egypt’s history of currency crises, this paper aims to identify the key drivers behind these episodes by focusing on the role of both economic and political-economy variables. Using a probit analysis and annual data over the period (19772021), the findings suggest that real exchange rate overvaluation, declining foreign reserves, falling portfolio investment, and rising external debt are also significant economic predictors for currency crises incidence in Egypt. In addition, the findings indicate that fixed exchange rate regimes, low levels of democracy, and the absence of capital controls significantly increase the likelihood of a crisis. Moreover, it is evident that accounting for these variables, along with the economic indicators, improves the model’s ability to predict currency crises.
  Keywords: currency crises; exchange market pressure index; political economy; probit model; Egypt.
  DOI: 10.1504/IJSE.2027.10075872
   
  
• Unveiling food inflation's response to carbon emissions, energy inflation, and economic policy uncertainty in the BRICS countries  
  by Amritkant Mishra 
  Abstract: This pragmatic investigation examines the dynamic response of food inflation to carbon emissions, energy price shocks, and economic policy uncertainty by applying panel ARDL and causality analysis for the BRICS countries from 2000 to 2023. The empirical evidence reveals that, in the long run, energy inflation and economic policy uncertainty do have a significant impact on food inflation. Conversely, the outcome indicates that, over the long run, carbon emissions do not influence food inflation in the panel countries. Furthermore, the short-run outcome shows that energy inflation does have a significant impact on food prices, while economic policy uncertainty and carbon emissions seem insignificant. Finally, the causality outcome reveals a unidirectional causal relationship from energy inflation to food inflation and from food inflation to economic policy uncertainty in the countries under consideration. These empirical findings have significant policy implications. Policymakers should aim to decrease the level of energy inflation and economic policy uncertainty in order to reduce food inflation.
  Keywords: carbon emissions; food inflation; energy inflation; economic policy uncertainty; EPU; BRICS; panel ARDL.
  DOI: 10.1504/IJSE.2026.10076367
   
  
• Environmental policy and productivity growth in the manufacturing industry: evidence from selected European countries  
  by Daniela Lena, Marco Cucculelli, Carl Pasurka 
  Abstract: The European Union’s pursuit of sustainable economic growth alongside ambitious carbon reduction targets has introduced a new era of green industrial policy. However, the implementation of environmental regulations may cause unintended economic consequences. This study investigates the relationship between environmental policy and productivity growth in seven manufacturing sectors across five EU member states from 2008 to 2015. Employing the Malmquist and Malmquist-Luenberger productivity indexes, we disentangle the effects of these policies on sectoral productivity. Our findings reveal that while environmental regulations have contributed to reduced emissions, they have also been associated with declining productivity growth in several manufacturing sectors. These results underscore the importance of designing environmental policies that balance ecological sustainability and economic performance, ensuring that green transitions support rather than hinder industrial productivity.
  Keywords: environmental regulation; productivity growth; Malmquist-Luenberger index; manufacturing industries.
  DOI: 10.1504/IJSE.2026.10076471
   
  
• Renewable energy-led growth hypothesis: an econometric analysis in top European countries in renewables  
  by Mounir Elkarimi 
  Abstract: This study analyses renewable and non-renewable energy use and gross domestic product (GDP) causal links in key European countries with significant renewable energy use. To this end, we employ econometric techniques, conducting time and frequency causality analyses within VAR and ARMA models. The results reveal significant causal relationship from renewable energy use to German GDP over only the long-run, namely over periods longer than six years. This finding supports the green energy-led growth hypothesis in Germany. No significant causality is found between renewable energy use and GDPs in UK, Italy, and Spain, which does not support green energy-led growth hypothesis in these economies. Furthermore, no substantial causal nexus is observed between non-renewable energy use and GDP. German policymakers should consider that enhancing renewable energy consumption would be useful to promote economic growth. Regarding the remaining economies, renewable energy and energy conservation policies appear empirically neutral with respect to economic growth.
  Keywords: economic growth; renewable energy; non-renewable energy; energy consumption; European countries.
  DOI: 10.1504/IJSE.2026.10076968
   
  
• Asymmetric effect of global uncertainty on trade between China and selected Sub-Saharan African economies  
  by Winnie O. Arazu, Oliver E. Ogbonna, Jonathan E. Ogbuabor, Mulatu F. Zerihum 
  Abstract: The emergence of China as a major trade partner to the Sub-Saharan African (SSA) region requires that policymakers understand how global economic policy uncertainty (GEPU) impacts trade with China. Using the nonlinear ARDL framework, this study investigates the asymmetric effects of GEPU on trade between China and six selected SSA economies, namely Angola, Ghana, Kenya, Nigeria, South Africa, and Tanzania, for the period 2000Q1 to 2022Q4. The findings show that the positive effects of declining GEPU are particularly pronounced in Nigeria, Ghana, and Tanzania in the long-run, while South Africa, Kenya, Ghana, and Angola exhibit stronger negative responses to rising GEPU in the short-run. Moreover, China trade flows to SSA overwhelmingly respond strongly to declines in uncertainty than to comparable increases, supporting the asymmetry argument. The study suggests that SSA economies should diversify their economic base and trading partners to mitigate reliance on China and safeguard against negative GEPU impacts.
  Keywords: economic policy uncertainty; international trade; asymmetric effect; nonlinear ARDL model; Sub-Saharan Africa; SSA; China.
  DOI: 10.1504/IJSE.2027.10078145
   
  
• Beyond gradualism: covert state capture and the roots of post-socialist capitalism in Slovenia  
  by Rado Pezdir 
  Abstract: Slovenia’s post-socialist transformation is often portrayed as a model of gradualism. Newly examined archival evidence from the Archives of the Republic of Slovenia (ARS, fond 1931) reveals, however, a hidden dimension that complicates this view. This article reconstructs a covert financial mechanism developed within the Slovenian branch of the Yugoslav State Security Service (Uprava državne varnosti UDV). From the late 1940s onward, Slovenian elites established offshore entities such as financial corporations SAF in Trieste and Colcommerz in Liechtenstein, embedded covert practices into the largest Slovenian bank, Ljubljanska banka, exported capital through intermediaries such as Adit, and re-imported it in the 1990s via quasi-private structures like financial holding KB1909. These processes were not spontaneous but part of a centrally regulated strategy of capital relocation and elite continuity. To capture this dynamic, the article introduces the concept of ex-ante state capture, denoting the deliberate, pre-emptive engineering of financial autonomy before regime change. The findings suggest that Slovenia’s apparent gradualism rested on covert Big Bang-style repositioning of assets, pointing to a broader, understudied dimension of post-socialist transformation.
  Keywords: Slovenia; post-socialist transformation; state capture; offshore finance; gradualism; elite continuity.
  DOI: 10.1504/IJSE.2026.10079811
   
  
• Sustainable development goals and frequency-based examination of unemployment using Google Trends data: evidence from G8 countries  
  by Muhammad Shahbaz, Süleyman Gürbüz, Murat Ergül, Cüneyt Kiliç, Ahmet Tayfur Akcan, Özgür Topkaya 
  Abstract: This study discusses unemployment and job seeking activity of individuals on the internet in the scope of sustainable development goals which set targets to be met by 2030. Timely assessment of targets is important and digitalisation paved new ways for analyses in this field which also relate to sustainability. The surge in job losses caused by the pandemic, regional conflicts and trade tensions are bringing unemployment and related issues to the forefront of policymakers’ agendas. This study utilises monthly Google Trends data from January 2007 to December 2021 to examine unemployment in G8 countries during this period. While analysing the relationship between variables, the maximal overlap discrete wavelet transform (MODWT) method, which helps to examine both the time and frequency dimensions of the series, was used. Then, the panel Fourier Toda-Yamamoto causality test was applied to determine the causality relationship between Google Trends data and the unemployment rate in the relevant countries. The results indicate that Google searches related to the term ‘unemployment’ are correlated with unemployment rates in most of the countries studied at different frequencies. Reliability of the results also indicates that besides institutional data, analyses based on Google Trends data can be an efficient way.
  Keywords: sustainable development goals; Google Trends; unemployment; wavelet theory; panel data analysis.
  DOI: 10.1504/IJSE.2027.10079843