Abstract
This study examines the moderating effect of uncertainty on the relationship between firms' research and development (R&D) expenditures and environmental innovation. Firms in Germany, France, Italy, and Spain, which are the first four largest economies in the European Union, are analyzed. A panel Tobit regression model is used to evaluate data from 102 that are involved in the consumer cyclicals, industry, energy, and raw materials sectors between 2006 and 2019. The findings indicate that while uncertainty plays a negative moderating role in the relationship between R&D spending and environmental innovation, R&D expenditures itself has a positive impact on environmental innovation. The research results on the relationship between uncertainty, R&D, and environmental innovation offer valuable insights for academics and policymakers. Additionally, these findings contribute to the expanding ESG literature by highlighting how uncertainty can diminish the positive effects of firms' R&D investments on environmental innovation in the specified countries.
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