Probing the carbon neutrality drive of environmental-related technologies and energy transition in France and Germany: a novel time–frequency technique

Abstract

AbstractThis study presents a rare comparative analysis of the factors influencing environmental quality through greenhouse gas (GHG) emissions in the European Union member states’ largest economies, i.e., France and Germany. By considering the unique economic, energy, and environmental characteristics of both countries, the finding unveils a novel perspective in the literature. The research utilizes a recently developed wavelet local multiple correlation (WLMC) technique with quarterly dataset spanning from 1990/Q1 to 2020/Q4. The results demonstrate that environmental-related information and communication technologies innovations, energy transition, and financial development play significant roles in limiting the growth of GHGs emission, particularly in the medium and long term. The wavelet-based Granger causality analysis reveals evidence of feedback causality among the variables in both countries in the medium and long term. Moreover, there are slight differences in the short-term relationships given that the observations are generally similar in later period. Overall, the findings offer a deeper understanding and policy insights regarding the time and frequency dynamics of GHG drivers in France and Germany. Graphical abstract