Politická ekonomie X:X | DOI: 10.18267/j.polek.1508

Environmental Regulations and Sustainable Development: The Role of Fiscal Decentralization and Clean Energy

Rong Wang, Xiaohan Gu, Yunqiu Zhan, Xiao Gu
Rong Wang, School of Marxism, Yulin Normal University, Yulin, China
Xiaohan Gu, Faculty of Law, University of Salamanca, Salamanca, Spain
Yunqiu Zhan, School of Marxism, Chengdu Technological University, Chengdu, China
Xiao Gu, School of Marxism, Hangzhou Polytechnic, Hangzhou, China

There is a growing recognition of the importance of sustainable development. Political economy factors and natural resources are considered important sources of economic prosperity. These are the fundamental primary resources utilized in the production process, which subsequently drives economic activities and results in sustained growth. Nevertheless, resource-rich countries often experience sustainability challenges. This study examines the impact of mineral resource rents on sustainable development in selected developed countries from a political economy perspective. Moreover, we include renewable energy deployment and fiscal decentralization as additional determinants of sustainable development. The study uses random-effects and fixed-effects estimation methods to estimate the model. The study also uses quantile regression econometric techniques. A sustainable development index (SDI), integrating economic, social, and environmental dimensions, is constructed as the dependent variable. The results reveal that mineral rents and renewable energy electricity output negatively affect sustainable development. Nevertheless, environment-related taxes and fiscal decentralization positively affect sustainable development. These results provide valuable insights for academia, researchers and policy makers aiming to achieve environmental sustainability through institutional and fiscal reforms.

Keywords: Sustainable development, mineral resources, political economy, natural resources, developed countries

Received: December 8, 2024; Revised: March 31, 2025; Accepted: April 25, 2025; Prepublished online: November 12, 2025 

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