Towards a greener future: How green technology innovation and energy efficiency are transforming sustainability

Abstract

Green technology innovation has gained incessant recognition due to rising concerns about environmental sustainability. It has the potential to improve energy efficiency by increasing total factor carbon productivity through mitigating effects. This research probes the asymmetric nexus between green technology innovation and energy efficiency in the top ten green innovator economies (Switzerland, Sweden, Germany, USA, Denmark, Finland, UK, Netherlands, Japan, and Norway). Prior investigations applied panel data approaches to acquire persistent outcomes on the green technology innovation-energy efficiency nexus, even though some countries did not individually demonstrate such a link. Comparatively, this study employs a distinctive 'Quantile-on-Quantile' technique that enables investigators to examine time-series dependence in each country by furnishing an international yet economy-specified understanding of the conjunction between the variables. Estimations disclose that green technology innovation improves energy efficiency in the majority of our selected economies at particular quantiles. It is also demonstrated that the asymmetries between our variables fluctuate among countries, highlighting the need for special care when adopting green innovation, energy efficiency, and sustainable environment policies.