Energy Security and Sustainable Development: The Moderating Role of Governance Across OECD and Non‐ OECD Countries

ABSTRACT

The sustainability implications of energy security depend not only on energy‐system conditions but also on institutional quality. However, evidence on the moderating role of governance across the environmental, economic, and social dimensions of sustainability remains limited, particularly in OECD and non‐OECD contexts. This study addresses this gap by examining how governance shapes the effects of energy security on these three dimensions. Using an unbalanced panel of 110 countries over the period 2001–2024, the study estimates models with country and year fixed effects and Driscoll–Kraay standard errors for the full sample and OECD and non‐OECD subsamples. In the full sample, energy security has positive effects on environmental and economic sustainability but a negative effect on social sustainability. Governance strengthens the positive environmental and economic effects while intensifying the adverse social effect. Across country groups, energy security has positive environmental and economic effects in both OECD and non‐OECD countries. Its social effect, however, is statistically insignificant in OECD countries but negative in non‐OECD countries. Governance moderates only the economic relationship in the OECD group, reducing the marginal effect of energy security, whereas in non‐OECD countries it strengthens the positive environmental and economic effects and makes the negative social effect more pronounced. Multiple robustness checks support the main conclusions and indicate that the results are not specific to a particular model specification or measurement choice. Overall, the sustainability effects of energy security depend on governance quality, the dimension considered, and the institutional context.