Environmental Investment on Economic Growth and Sustainable Development: A Case Study of North Sumatra

Abstract

Purpose – This study aims to analyze the effect of environmental investment on economic growth and sustainable development in North Sumatra during the period 2011–2024. Methodology/approach – The research employs a quantitative approach using time series data analyzed through simple linear regression. Prior to hypothesis testing, classical assumption tests were conducted, including normality, heteroskedasticity, and autocorrelation tests. Hypothesis testing was carried out using the partial t-test and the coefficient of determination (R²). Findings – Hypothesis testing was carried out using the partial t-test and the coefficient of determination (R²). The results indicate that environmental investment has a positive and significant effect on both economic growth and sustainable development. The coefficient of determination shows that environmental investment has a strong explanatory power in explaining variations in economic growth and sustainable development.  Novelty/value –  that environmental investment not only plays a role in environmental preservation but also serves as an important instrument in promoting sustainable economic growth and development in North Sumatra