Carbon Emission Reduction Policies and Their Impact on National Economic Growth

Abstract

Carbon emission reduction policies have become central to global efforts to achieve sustainable economic development. This study examines the impact of carbon reduction policies on national economic growth by considering the roles of green innovation, renewable energy development, and institutional governance. Using panel data from 40 countries, the study applies econometric analysis to evaluate the relationship between environmental policies and economic performance. The findings indicate that stronger carbon emission reduction policies significantly enhance economic growth, with green innovation and renewable energy development serving as important transmission mechanisms. The results demonstrate that environmental sustainability and economic expansion can be mutually reinforcing when supported by effective governance and technological transformation. This study contributes to environmental economics literature by providing an integrated understanding of how climate policies generate economic benefits and offers practical insights for policymakers seeking to balance emission reduction commitments with national development objectives.