Environmental Sustainability in Resource‐Dependent Economies: Does Digitalisation Complement the Energy Transition?

Abstract

Achieving environmental sustainability while sustaining economic transformation remains a major challenge for resource‐dependent economies, particularly in the Gulf Cooperation Council (GCC) region. This study investigates the impacts of digitalisation, renewable energy consumption, resource efficiency, foreign direct investment, financial development, and economic development on environmental sustainability in GCC countries over the period 2000–2024. Ecological footprint is employed as a comprehensive indicator of environmental degradation. The analysis employs second‐generation panel econometric techniques, including MMQR, SQREG, KRLS, Westerlund bootstrap cointegration, and the Dumitrescu–Hurlin panel causality test, complemented by lagged MMQR and pre‐/post‐2014 oil price shock robustness analyses. The results show that resource efficiency consistently reduces ecological degradation, while the mitigating effect of renewable energy consumption strengthens at higher quantiles. Digitalisation generally improves environmental quality through heterogeneous effects, whereas economic growth persistently increases ecological degradation. In contrast, the impacts of financial development and foreign direct investment remain heterogeneous. Overall, the robustness analyses confirm the stability of the findings, providing updated evidence on the heterogeneous drivers of ecological degradation and advancing understanding of the digitalisation–environment nexus in GCC economies.