The nexus between research and development, renewable energy and environmental quality: Evidence from developed and developing countries

This study investigated the nexus between greenhouse gas (GHG) emission, renewable energy, forest area, total patents, and research and development (R&D) expenditures in developed and developing countries from 1995 to 2018. The Dumitrescu and Hurlin non-causality test explored two-way causality between GHG and total patents (developed countries), R&D expenditures, and total patents (developed countries). The one-way causality was found from GHG to renewable energy (developed countries), renewable energy to the number of patents (developed countries, developing countries), GHG to R&D expenditures (developed countries), R&D expenditures to renewable energy (developed countries), renewable energy to GHG (developing countries), GHG to the total number of patents (developing countries), and renewable energy to R&D expenditures (developing countries). The Pooled Mean Group estimator revealed the reduction in GHG due to utilization of renewable energy in developed and developing countries. Moreover, the GHG reduction was also found due to an increase in the forest area in developed and developing countries. Environmental quality can be improved by fixing the target of renewable energy share in the total energy mix, provision of subsidy to environment-friendly projects, efficient energy use, increase in the forest cover, implementation of environmental standards, and promotion of environment-friendly products by using media.