Asymmetric Impact of Green Innovation and Taxation on Environmental Sustainability in Developing Countries

Dianfei Luan (), Hamid Mahmood (), Samia Khalid () and Bashir Ahmad Fida ()
Additional contact information
Dianfei Luan: Wuxi Vocational College of Science and Technology
Hamid Mahmood: Xi’an Jiaotong University
Samia Khalid: Xi’an Jiaotong University
Bashir Ahmad Fida: Faculty of Business & Economics, Modern College of Business and Science

Journal of the Knowledge Economy, 2025, vol. 16, issue 1, No 179, 5216-5237

Abstract: Abstract In developing countries, economic and technological advancements have led to macroeconomic volatility. This emphasizes how traditional linear estimation methods must take nonlinearity into account. Thus, using data from 1995 to 2019, this study investigates the asymmetric impact of green innovation and green taxation on environmental sustainability in developing countries. This is the first research to identify both symmetric and asymmetric links between these variables using the PMG-ARDL and NARDL models. The results imply that positive shocks in green innovation and green taxes encourage environmental sustainability by lowering carbon emissions. However, negative shocks from green innovation and green taxes seriously compromise sustainability by increasing emissions. This asymmetric impact is confirmed by the Wald test which shows that distinct effects on environmental sustainability in developing countries are attributed to both positive and negative shocks. The research also reveals that trade openness favorably improves environmental sustainability, but urbanization has a deleterious effect. These insights suggest that policymakers should take into account the asymmetric impacts of green innovation and taxation when devising environmental policies and allocating resources.

Keywords: Environmental sustainability; Green innovation; Green taxes; Panel NARDL; Developing countries (search for similar items in EconPapers)
JEL-codes: H32 O32 O40 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s13132-024-01959-0 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:jknowl:v:16:y:2025:i:1:d:10.1007_s13132-024-01959-0

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/13132

DOI: 10.1007/s13132-024-01959-0

Access Statistics for this article

Journal of the Knowledge Economy is currently edited by Elias G. Carayannis

More articles in Journal of the Knowledge Economy from Springer, Portland International Center for Management of Engineering and Technology (PICMET)
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().