Impact of technological progress on carbon emissions in different country income groups

Abstract

This study examines the complex relationship between carbon emissions and technological progress in a sample of 60 countries divided into four income groups for the period 1989–2018. For robustness purposes and due to the broad definition of technology, we use six different proxies to represent technology: Information and telecommunication technology (ICT), patents, public R&D expenditure, Total factor of productivity (TFP), science and technology publications. After applying the fixed-effect method with Driscoll and Kraay standard errors, ICT variables appear to be good instruments for carbon reduction in the full sample. However, R&D expenditure and patents do not significantly impact carbon emissions. TFP increases carbon emissions, while science and technology publications are negatively related to carbon emissions. The analysis shows mixed results for the various country income groups and all indicators.