The impact of government-funded renewable energy R&D on its consumption

Dierk Herzer

Journal of Policy Modeling, 2025, vol. 47, issue 5, 903-918

Abstract: With the increasing urgency to shift away from fossil fuels, many governments are boosting their funding for renewable energy research and development (R&D). The fundamental premise behind these efforts is that government-funded renewable energy R&D contributes to increased consumption of renewable energy. This paper examines this premise employing panel data from 26 countries between 1974 and 2022. Based on panel cointegration methods and panel causality tests, this study finds robust evidence of a statistically significant positive long-term relationship between government-funded renewable energy R&D and renewable energy consumption. It also identifies unidirectional causality running from the former to the latter.

Keywords: Renewable energy consumption; Government-funded renewable energy R&D; Public energy RD&D expenditures; Panel cointegration; Causality tests (search for similar items in EconPapers)
JEL-codes: O32 Q42 Q48 Q55 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jpolmo:v:47:y:2025:i:5:p:903-918

DOI: 10.1016/j.jpolmod.2025.06.001

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