Matching Administration Impartiality, Technological Innovation and State Capacity with Environmental Sustainability: Evidence from Vietnam and Singapore

Abstract

This study aims to explore the relationship between state capacity variables, technological innova-tion, and environmental sustainability in two ASEAN members, namely, Vietnam and Singapore over the period of 2000 to 2020. The study employs the Auto-Regressive Distributed Lag model to examine the exist-ence of a relationship, and a Granger causality analysis to capture the causal effect between the variables. The results reveal, a negative association between impartial administration, technological innovation, and environ-mental sustainability in the long run for both countries. Nevertheless, the granger test demonstrates a causality effect running from impartial administration to environmental sustainability and between technological inno-vation to environmental sustainability for Singapore. Moreover, a negative association emerges for the rule of law. Signifying, perhaps, stricter environmental legislation could hamper the state's sustainability mission by undermining potential stakeholders. On the other hand, the negative relationship between technological inno-vation and environmental sustainability, and the nonexistence of causal effect reveals Vietnam's still immature technological development. However, an effect running from environmental sustainability to technological innovation takes place in Vietnam’s context, presumably, showing that embracing environmental sustainabil-ity will lead the market to invest in green technologies, hence, retroactively, establishing a market-oriented toward green competitiveness.