The role of technological innovations and renewable energy consumption in reducing environmental degradation: evidence from the belt and road initiative countries

Attaining sustainable economic growth has become an important concern for most countries. Countries are accelerating economic growth; however, an increase in economic activities through production raises energy demand and thus leads to high carbon emissions. Innovations might be useful to enhance energy efficiency and acquire renewable energy sources to be used for production and achieve sustainable growth. This study examines the effect of innovation, renewable energy consumption, and economic growth on carbon dioxide emission in the belt and road initiative countries from 1979 to 2019. The study uses OLS, fixed effect, and generalized method of moments for analysis where the results indicate that innovation indicators significantly improve environmental quality; however, innovation proxy by patent application nonresidents increases carbon dioxide emission. The study also found that renewable energy consumption and international trade significantly raise environmental quality, while foreign direct investment and economic growth raise emissions and lead to environmental degradation. The quadratic term of economic growth confirms the validity of the environmental Kuznets curve in the belt and road initiative countries. The findings of this research have significant policy implications for the sample countries regarding environmental quality enrichment through improvement in technological innovation and acquiring renewable energy consumption.