Impact of Digitalization, Big Data, and AI in Society 5.0 on the Four Major Hypotheses and Income Inequality

Sustainable development has become a global priority, with individuals, businesses, and governments working toward the Sustainable Development Goals to address environmental challenges, particularly climate change. However, the increasing severity of climate-related disasters, environmental degradation, and widening income inequality associated with globalization continues to complicate international efforts toward sustainability. These challenges raise concerns about the prospects for coordinated environmental policies between developed and developing countries. In this context, the emergence of Society 5.0, supported by digitalization, big data, and artificial intelligence (AI), presents opportunities to integrate economic development with solutions to social and environmental challenges. These technological advances may provide new insights into longstanding debates in environmental economics, particularly those concerning the environmental Kuznets curve, the resource curse, the pollution haven hypothesis, the Porter hypothesis, and income inequality. This narrative literature review examines research trends and emerging challenges by focusing on highly cited studies published in influential academic journals between 2015 and 2025. Through a synthesis of literature, the review explores how digitalization, big data, and AI are influencing the interpretation and application of established environmental economics hypotheses.