Globalization, AI Innovation, and Financial Accessibility: New Insights into Environmental Sustainability in the G-7

Authors

https://doi.org/10.48314/ceti.v3i1.61

Abstract

This study reexamines the determinants of environmental sustainability in the G-7 economies by focusing on the roles of Artificial Intelligence (AI) innovation, financial accessibility, globalization, and urbanization within the Load Capacity Curve (LCC) framework. Using annual data spanning 1990-2019, the analysis employs advanced panel econometric techniques, including panel Autoregressive Distributed Lag (ARDL) and quantile regression, to capture both average and distributional effects. Prior to estimation, Cross-sectional Dependence (CD) and slope heterogeneity are confirmed, while second-generation unit root and panel cointegration tests establish long-run equilibrium relationships among the variables. The empirical findings validate the LCC hypothesis, revealing a nonlinear relationship between economic growth and the Load Capacity Factor (LCF). AI innovation and financial accessibility significantly enhance environmental sustainability by improving resource efficiency and supporting cleaner production systems. In contrast, globalization and urbanization exert downward pressure on ecological capacity, indicating increased environmental strain in highly integrated and urbanized settings. Quantile regression results further demonstrate that these effects vary across different levels of environmental performance. Robustness checks using Driscoll–Kraay standard errors, augmented mean group, and common correlated effects mean group estimators confirm the consistency of the results. The study highlights the importance of integrating technological innovation and inclusive financial systems into sustainability policies while managing the environmental risks associated with globalization and rapid urban expansion.

Keywords:

Artificial intelligence, Financial accessibility, Globalization, Load capacity curve, Environmental sustainability

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Published

2026-01-13

Issue

Vol. 3 No. 1 (2026): Computational Engineering and Technology Innovations

Section

Articles

How to Cite

Mo, K., Tasnuva, T., Farukh, M. O., & Tithi, S. I. (2026). Globalization, AI Innovation, and Financial Accessibility: New Insights into Environmental Sustainability in the G-7. Computational Engineering and Technology Innovations, 3(1), 1-13. https://doi.org/10.48314/ceti.v3i1.61

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