Economic Growth, Innovation, and CO 2 Emissions: Analyzing the Environmental Kuznets Curve and the Innovation Claudia Curve in BRICS Countries

Ionuț Nica, Irina Georgescu () and Jani Kinnunen
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Ionuț Nica: Department of Economic Informatics and Cybernetics, Bucharest University of Economic Studies, 0105552 Bucharest, Romania
Irina Georgescu: Department of Economic Informatics and Cybernetics, Bucharest University of Economic Studies, 0105552 Bucharest, Romania
Jani Kinnunen: Department of Information Systems, Åbo Akademi University, Tuomiokirkontori 3, 20500 Turku, Finland

Sustainability, 2025, vol. 17, issue 8, 1-38

Abstract: This study explores the dynamic relationship between economic growth, technological innovation, and C O 2 emissions in BRICS nations, integrating the Environmental Kuznets Curve (EKC) and Innovation Claudia Curve (ICC) frameworks. Using a panel ARDL approach on data from 1991 to 2023, we investigate the long-run and short-run interactions between GDP, renewable energy consumption (RENC), foreign direct investment (FDI), urbanization (URB), and patent applications (PAs) in shaping environmental outcomes. The findings confirm the EKC hypothesis, revealing an N-shaped relationship between GDP and emissions, indicating that while economic growth initially leads to higher C O 2 emissions, this trend reverses at a critical threshold before a secondary increase occurs at higher income levels. The ICC framework identifies a cubic relationship between innovation and emissions, where technological advancements initially drive higher emissions before contributing to sustainability at later stages, though an excessive scale of innovation may reintroduce environmental pressures. RENC is found to significantly mitigate emissions, while URB and FDI display dual and context-dependent effects, highlighting the multidimensionality of sustainable transitions in emerging economies. These results underscore the importance of targeted policy interventions, such as scaling renewable energy infrastructure, promoting green innovation, guiding urban expansion, and aligning FDI with environmental objectives.

Keywords: panel ARDL; environmental Kuznets curve; innovation Claudia curve; BRICS countries; circular economy (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
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