An analysis of the relationship between economic complexity-energy and economic growth: evidence from method of moment quantile regression

This study explores the effect of the conjunction of economic complexity and the renewable and the nonrenewable energy on economic growth. Panel quantile regression approach was employed, this is in order to take account for asymmetry and heterogeneity of dataset and, furthermore, to specify the influence of different quantiles of economic complexity and the renewable and the non-renewable energy on different quantiles of economic growth. It utilizes an unbalanced panel dataset for 31 OECD countries spanning during 1995-2023. Our findings reveal the positive and significant effect of economic complexity and the negative and significant effect of energy consumption on economic growth. Moreover, the interweaving of economic complexity and renewable energies has a positive and significant effect on economic growth at the different quantiles retained. Regarding the implications of economic policies, our results suggest that economic complexity and renewable energy are the main determinants of economic growth. To control economic tensions and succeed in the energy transition, OECD economic policy must be based on decoupling economic growth from nonrenewable energy in favor of economic growth induced by economic complexity and renewable energy.