Evaluating the Impact of Good Governance on Climate Change Performance

Climate change has become one of the major global challenges due to its widespread impacts on human ecosystems and the environment. In this context, good governance, through appropriate management and strong measures against climate change, plays a crucial role in preserving natural resources and mitigating its negative effects. The aim of this study is to examine the impact of good governance on climate change performance in selected countries over the period from 2017 to 2020. In this regard, the study employs a panel threshold regression approach and bootstrap simulation method to approximate the limiting distribution of the test statistic. The findings from the non-threshold model estimation indicate that good governance has a significant and positive impact on climate change performance. On the other hand, the estimation of the threshold random-effects model suggests the existence of a threshold value of 60.345% for the good governance index. Taking the threshold effect into account, the results show that both before and after the threshold, good governance has a positive and significant impact, reducing climate change. In other words, it has a positive and significant effect in both regimes. Therefore, good governance has an impact on climate change performance and can act as a mitigating factor for climate change in both developing and developed countries to control the increasing trends of climate change. Furthermore, according to the results of this study, the economic growth variable has a positive effect, while industrialization and research and development expenditure have a negative and significant effect on climate change.