Green Technological Progress Implications on Long-Run Sustainable Economic Growth

Abstract

The main objective of this study is to model and examine the green technological progress’s positive and negative externalities spillover effects on the sustainable economic growth of 15 economies from Asia, the Pacific, and Latin America. The study calculated labour and capital contributions to green total factor productivity growth via the inclusion of CO2 emissions as undesirable output or private unpriced input and energy consumption that proxies for unmeasured pollutant emissions. The results, in most cases, confirm that a high level of air pollutant emissions generated by these countries’ economic development affected the growth rates of TFP growth as an indicator of green technological progress. The significant contribution of this study is to integrate innovation and climate change in the form of green productivity (green technological progress). The role of these externalities on long-term sustainable economic growth has been ignored by several past studies undertaken in these areas.