The Impact of Environmental Technologies and Environmental Policy Stringency on Environmental Degradation

Özen Akçakanat, Gökhan Özkul, Ozan Özdemir and Muhammed Kasım

Journal of Research in Economics, Politics & Finance, 2025, vol. 10, issue SI, 318-335

Abstract: The increase in global warming and environmental pollution accelerates ecological degradation and prompts governments worldwide to adopt policies aimed at addressing environmental challenges while maintaining economic growth. In this context, this study examines how environmental technologies and policy stringency affect CO₂ emissions using panel data from 38 OECD countries for the period 1990-2022. The analysis, based on fixed effects and Driscoll-Kraay (1998) estimators, reveals that per capita GDP, exports, industrial activities, fossil fuel consumption, and education expenditures support economic expansion but also contribute to higher emission levels. The results indicate that both energy use and policy stringency significantly impact emission outcomes. While the proportion of environmental technologies reduces emissions, the unexpected positive relationship shown by the number of patents may be attributed to the time lag between the implementation of patents or to the production of more patents in high-emission countries. Overall, the findings indicate that environmental innovation alone cannot achieve emission reductions; it must be supported by strong policy implementation.

Keywords: Environmental Degradation; Carbon Emission; Environmental Technology Innovations; Environmental Policy Stringency; Dynamic Panel Data (search for similar items in EconPapers)
JEL-codes: O13 Q50 Q55 Q58 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:ahs:journl:v:10:y:2025:i:si:p:318-335

DOI: 10.30784/epfad.1813824

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