Fueling the Future: Exploring the Nexus of Renewable Energy, Population Shifts, and Economic Development in Five Global Economies

Abstract

This study investigates the relationship between economic growth and key energy-related and demographic variables across five major economies—China, the United States (U.S.), Germany, Brazil, and India—from 2000 to 2023. Using panel data analysis, the study examines how renewable energy consumption, fossil fuel use, population growth, gross fixed capital formation (GFCF), and urbanization influence Gross Domestic Product (GDP) per capita. The findings suggest a robust positive association between renewable energy consumption and economic growth, while population growth and reliance on fossil fuels exert a negative influence. The effects of GFCF and urbanization vary across countries, with several results lacking statistical significance. Country-specific analyses reveal significant heterogeneity: fossil fuel consumption negatively affects GDP in Germany, India, and the U.S., but shows a positive impact in Brazil. Urbanization supports economic growth in some countries, while having limited or negative effects in others. These findings underscore the importance of formulating development and energy strategies that are attuned to each country’s unique economic structures and policy environments.