Quantifying the role of the energy transition in alleviating marginalisation and advancing inclusive green growth

Achieving a genuine energy transition and fostering inclusive green growth requires addressing the marginalisation of workers. Failing to do so is an ethical failure and a significant barrier to realising a just and sustainable future. The path to sustainable development and a green economy cannot be built on the exploitation or exclusion of those whose livelihoods are directly affected by these transformations. Genuine progress cannot be claimed if large segments of society are left to absorb the economic and social costs of decarbonisation. Sustainable development must be inclusive, ensuring that the benefits of the green transition are shared equitably, with no one left behind in pursuing both environmental and economic goals. This paper examines the role of the energy transition in mitigating labour marginalisation and promoting inclusive green growth, with a particular focus on developed countries. Our empirical strategy combines time series analysis with dynamic econometrics to explore the relationships between these variables. The findings indicate that the energy transition is a positive and statistically significant predictor of inclusive green growth. Conversely, labour marginalisation emerges as a significant negative predictor, impeding inclusive green growth. Policymakers should prioritise creating accessible, well-paid green jobs in renewable energy and environmental conservation, while also addressing job losses in the informal sector through the integration of inclusive green growth strategies. Implementing comprehensive social protection measures for workers displaced by the green transition is essential, ensuring their economic security during this transformation. Furthermore, strengthening institutional frameworks is essential for driving sustainable development and ensuring the green transition is inclusive and equitable and effectively promotes environmental quality.