Chapter 12: Green Growth Policy in Visegrad: Key Drivers from an Economic and Non-economic Perspective

Purpose: This chapter evaluates the state of the implementation of the green growth policies in the Visegrad countries. The authors examine the main determinants of the transition to a green economy.

Need for the study: Conventional economic growth, based on fossil fuel and the extensive use of other natural resources, has created many environmental problems. The current industry-based economic growth in the Visegrad countries is not exempt from these challenges. Therefore, a transition from the current economic growth system in the Visegrad countries to a green growth system is essential.

Methodology: After qualitative analysis of green growth policies, the study applies panel Fully Modified OLS (FMOLS) to estimate the effects of environmental policy strictness, carbon taxes, green finance on greenhouse gas (GHG) emission, the share of renewable energy in total energy consumption, material productivity and green patents.

Findings: The European Union (EU) requirements are the primary motivation for implementing green growth policies in the Visegrad countries. Carbon taxes do not have a sizable effect on GHG emissions or increasing the share of renewable energy consumption. However, green finance has a small positive effect on the number of green patents and material productivity.

Practical implications: The results of this study can guide policymakers in better formulating a green transition strategy for the Visegrad countries. Green technology is the ultimate driver of green growth. This study's findings highlight that government financial support is crucial for developing new green technologies and implementation of existing technologies for mass production.