One of the things that you may dislike about react native is this kind of mysterious errors that popup from time to time. Where anything works in harmony and suddenly you encounter

error Failed to install the app. Make sure you have the Android development environment set up

And I can swear to you that my Android development environment was all set correctly because seconds ago everything was perfect!
So only if you can swear like me that your android development were setup, then feel free to continue with this solution.
Otherwise, you may checkout setting up the development environment Article on https://reactnative.dev/docs/environment-setup

#So what you can do is to

• Remove node_modules
• Install node_modules again at project root

npm install

• Move to android folder

cd android

• Run the following commands to give gradlew file permissions

chmod +x ./gradlew
xattr -l ./gradlew

• Skip this step if you already have Homebrew install in your Mac

ruby -e "$(curl -fsSL https://raw.githubusercontent.com/Homebrew/install/master/install)"

• Now come the most important step. Which is installing ADB platform-tools

brew cask install android-platform-tools

• Close your terminal then reopen it again and run following command at your project root.

npx react-native run-android