Green Finance And Economic Growth In Algeria: An Ardl Approach (1995–2023)
Auteurs : Benmerzoug Nabil .
Résumé
This study examines the relationship between green finance and economic growth in Algeria over the period 1995–2023. The analysis is motivated by the growing importance of sustainable finance in economies facing structural dependence on hydrocarbons, external vulnerability, and climate-transition pressures. Drawing on endogenous growth theory and ecological modernization theory, the paper evaluates whether green finance can contribute to a more sustainable growth trajectory in Algeria. Methodologically, the study employs the Autoregressive Distributed Lag (ARDL) approach to investigate both short-run dynamics and long-run relationships among real gross domestic product (GDP), a green finance proxy based on renewable energy investment, CO2 emissions, and total exports. The nominal green finance series is converted into real terms using a domestic price deflator before applying the ln(1 + GREEN_REAL) transformation. The Augmented Dickey-Fuller (ADF) test indicates that all variables are integrated of order one, I(1), which supports the use of the ARDL bounds-testing procedure, provided that none of the variables is I(2). The bounds test suggests the existence of a long-run cointegrating relationship among the variables. In addition, the error correction term is negative and statistically significant, indicating convergence toward long-run equilibrium after short-run disturbances. Diagnostic and stability tests suggest that the estimated model is statistically acceptable, while the results remain subject to the limitations of a small annual sample. The findings support the view that green finance should be considered within Algeria’s broader strategy of economic diversification and sustainable development. However, the empirical results should be interpreted with caution, given the proxy nature of the green finance variable and the limited number of control variables included in the baseline specification. Overall, the study contributes to the literature by providing evidence on the macroeconomic relevance of green finance in the Algerian context.
Mots clés
Green finance; Economic growth; ARDL model; Algeria; CO2 emissions; Sustainable development
