The dual engines of political stability and digital technology: An international political economy analysis based on the green trade and climate change reversal mechanism in RCEP countries

Abstract

Within the complex framework of international political economy, the continued focus on climate change and environmental degradation has spurred the rapid development of green trade. Sovereign states are promoting the cross-border flow of environmentally friendly goods and technologies through the implementation of green trade policies, aiming to accelerate the growth of the green trade system. However, the advancement of green trade faces multiple challenges, such as the inconsistency of international green standards, the relatively high costs of green products, and consumers’ lack of awareness about eco-friendly products. Utilizing the theoretical framework of international political economy, this study explores the interrelationship between green trade and climate change, analyzing how to overcome these challenges from both domestic and international obstacles could potentially reverse the current adverse trends. Particularly, it examines how political uncertainty and the global free-rider problem act as moderating variables in the relationship between green trade and climate change, thereby affecting the dynamic interaction between the two. Relying on this theoretical framework, the study conducts regression analysis using data from member countries of the Regional Comprehensive Economic Partnership (RCEP) and finds that the initial stages of green trade may have a negative impact on the climate, and its relationship with climate change follows the environmental Kuznets curve, which will mitigate climate change in the long term. Furthermore, the study concludes that political stability and digital technology can reverse the negative impacts of green trade on the climate, thereby ensuring that green trade can genuinely support the goals of environmental sustainability.