Revisiting Research and Development Expenditures and Trade Adjusted Emissions: Green Innovation and Renewable Energy R&D Role for Developed Countries

Abstract

Research and development’s role in achieving the Sustainable Development Goals is crucial. More specifically, to achieve a sustainable environment, the role of environment-related research and development expenditures, along with renewable energy research and development, is also important. This study focuses on the sustainable development perspective and the role of a sustainable environment via building a knowledge-based economy. A knowledge-based economy is more research and development oriented, and its role is undeniable in ensuring sustainable development. The current study focuses on the role of general research and development, environmental research and development, and cleaner energy research and development perspective for developed economies from 1989 to 2021. The study evaluated the role of research and development expenditures for the environment and cleaner energy on consumption-based carbon emissions along with political risk, income, green innovation, exports, and imports. The study used novel panel methods for econometric analysis. The study found that research and development expenditures for the environment and cleaner energy help limit carbon emissions. Moreover, reducing political risk, increasing green innovation, renewable energy consumption, and exports are also linked inversely with carbon emissions. In contrast, imports and income are deteriorating factors for consumption-based carbon emissions. The study recommends increasing research and development expenditures, encouraging green innovation, and limiting political risk for sustainable development.