The role of green technology on carbon emissions: does it differ across countries’ income levels?

Abstract

This study examines the impact of green technology on CO 2 emissions in a sample of 45 countries, divided into three income categories between the periods of 1989-2018. Renewable energy consumption and environmental-related patents are used as indicators of green technology. We consider the production of renewable energy and the development of climate-related technologies as "two sides of the same coin". One needs to be complemented by the other for countries to be successful in the fight against climate change. After applying the fixed-effect method with Driscoll and Kraay standard errors, results reveal that renewable energy consumption significantly reduces CO 2 emissions in the full sample and all three subsamples (High-income, Upper-middle-income, and Lower-middle income countries). However, environmental-related patents significantly lower CO 2 emissions only in very high-income countries. This paper also examines how CO 2 emissions influence the development of green technology and carbonintensive technology. A negative association is found between renewable energy and CO 2 emissions in the high-income and upper-middle-income groups. Because higher carbon emissions encourage high-income and upper-middle-income countries to invest in renewable energy, and this translates into lower carbon emissions over time. Environmental-related patents respond positively to carbon emissions only in highincome countries. The results obtained in this study allow us to draw important conclusions for energy policies. Among the necessary measures to be adopted, developing countries should not neglect the promotion of green innovation, which is a critical condition for carbon neutrality achievement.

The impact of digital inclusive finance on environmental pollution: A case study of air pollution

“…Particularly in the renewable energy sector, advancements in wind and solar technologies have significantly reduced dependency on fossil fuels, directly lowering greenhouse gas emissions and other harmful emissions from burning coal and oil [ 63 , 64 ]. In the transportation sector, the development of electric vehicles and other low-emission transport solutions offers effective ways to reduce urban exhaust emissions, playing a key role in improving urban air quality with their zero-emission characteristics during operation [ 65 , 66 ]. Additionally, the application of energy-saving technologies in buildings and industrial production indirectly reduces air pollution by increasing energy efficiency and optimizing resource use [ 67 ].…”