How Are Energy-Related R&D Investments Effective on Environment-Related Patents? Empirical Evidence from the USA and Canada

Dilvin Taşkın, Serpil Kılıç Depren and Fatih Ayhan

Journal of Sustainable Development Issues (JOSDI), 2024, vol. 2, issue 2, 115-128

Abstract: All related economic actors have been interested in combating climate change as consistent with developing interest in environmental issues. In this context, R&D investment funds can be highly beneficial in developing environmental patents, which may have a key role in solving environmental problems. Accordingly, the study analyzes the marginal effect of sub-types of R&D investments on environment-related patents by focusing on the USA and Canada as the leading R&D investing countries, using data between 1990 and 2021, and adopting a kernel-based regularized least squares (KRLS) model. The results show that on the patents (i) R&D investments in cross-cutting technologies/research, nuclear, and renewable have a stimulating effect in the USA; (ii) R&D investments in renewable support the increase in Canada; (iii) in both USA and Canada, R&D investments in fossil fuels have a decreasing effect, whereas R&D investments in energy efficiency have no significant effect; (iv) Among all, R&D investments in cross-cutting technologies/research (renewable) have the highest increasing effect on the patents in USA (Canada); (v) marginal effect of the sub-types of R&D investments on the patents varies across factors, countries, and percentiles; (vi) the KRLS model has a high prediction performance, reaching ~97.1%. Overall, the study emphasizes the average and pointwise marginal effects of R&D investments on the patents, which imply that R&D investments should be re-distributed by considering their effects on the patents so that a successful policy on environmental patents can be designed by benefitting energy-related R&D investments.

Keywords: Environmental Patents; Energy-Related R&D Investments; USA; Canada; KRLS Model (search for similar items in EconPapers)
JEL-codes: C32 O30 O51 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:arv:journl:v:2:y:2024:i:2:p:115-128

DOI: 10.62433/josdi.v2i2.36

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