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The role of innovations and renewable energy consumption in reducing environmental degradation in OECD countries: an investigation for Innovation Claudia Curve

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Abstract

Rising economic growth in recent ages is the primary concern of most of the countries to enhance the living standard, but the ever-increasing production of economic activities consumes a lot of energy, which leads to a sharp increase in carbon dioxide emissions. Innovation may be a remedy that can help improve energy efficiency, obtain renewable energy, and promote economic growth, thereby protecting the quality of the environment. Therefore, this paper examines the role of innovation and renewable energy consumption in CO2 reduction in OECD countries from 2004 to 2019. By using the two-step system generalized of moment estimator, the results show that economic growth and innovation significantly increase carbon emissions, however the innovation Claudia Curve (ICC) is verified, and the environmental Kuznets curve does not exist. Foreign direct investment has a negative impact on carbon emissions, thus verifying the Pollution Hao hypothesis, whereas renewable energy also improves environmental quality, but the interaction between innovation and renewable energy consumption still increases carbon emissions. Financial development, industrialization, trade, and energy consumption have also been found to be harmful factors of environmental quality. Our findings have considerable policy implications for OECD countries on the improvement of innovation indicators and investment in renewable energy sources to rise environmental quality.

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Data availability

Data used in this paper is available on world bank world development indicators. https://databank.worldbank.org/source/world development-indicators.

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Acknowledgements

The authors are thankful to the journal editor and anonymous reviewers for useful suggestions and recommendations on the paper quality improvement.

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Authors and Affiliations

  1. China Center for Special Economic Zone Research, Shenzhen University, Shenzhen, China

    Hayat Khan

  2. Business School of Xiangtan University, Hunan, China

    Itbar Khan

  3. School of Public Administration, Hohai University, Nanjing, China

    Robeena BiBi

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  1. Hayat Khan
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  2. Itbar Khan
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  3. Robeena BiBi
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Formal analysis was performed by Hayat Khan, formal writing was done by Itbar Khan, and interpretation of results was done by Robeena Bibi.

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Correspondence to Itbar Khan.

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Khan, H., Khan, I. & BiBi, R. The role of innovations and renewable energy consumption in reducing environmental degradation in OECD countries: an investigation for Innovation Claudia Curve. Environ Sci Pollut Res 29, 43800–43813 (2022). https://doi.org/10.1007/s11356-022-18912-w

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