Impact of productive capacity shifts, energy-related R&D investments, energy use, and income on environmental degradation: Evidence from leading developed countries

Kartal M. T., Santosh M., Taşkın Yeşilova F. D., KILIÇ DEPREN S., Ayhan F.

RENEWABLE ENERGY, vol.251, 2025 (SCI-Expanded, Scopus) identifier identifier

  • Publication Type: Article / Article
  • Volume: 251
  • Publication Date: 2025
  • Doi Number: 10.1016/j.renene.2025.123338
  • Journal Name: RENEWABLE ENERGY
  • Journal Indexes: Science Citation Index Expanded (SCI-EXPANDED), Scopus, Academic Search Premier, PASCAL, Aerospace Database, Aquatic Science & Fisheries Abstracts (ASFA), CAB Abstracts, Communication Abstracts, Compendex, Environment Index, Geobase, Greenfile, Index Islamicus, INSPEC, Pollution Abstracts, Public Affairs Index, Veterinary Science Database, DIALNET, Civil Engineering Abstracts
  • Keywords: Clean energy, Developed countries, Energy-related public R&D investments, Environmental degradation, Productive capacity shifts
  • Open Archive Collection: Article
  • Azerbaijan State University of Economics (UNEC) Affiliated: No

Abstract

Environmental degradation (ED) has emerged as a significant challenge against the increasing demands of modern civilization. Therefore, transforming the economic structure into an eco-friendly structure is highly critical. So, this study focuses on the impacts of productive capacity shifts in key areas on ED in leading six developed economies by considering carbon dioxide (CO2) emissions as a dependent variable; using the productive capacity index (PCI) for human capital (PCI-HCA), transport (PCI-TRA), institutions (PCI-INS), energy-related public R&D investments, economic growth, nuclear energy, and renewable energy as independent variables; and applies a kernel-based regularized least squares (KRLS) method on data from 2000 to 2022. The results show that (i) PCI-HCA curbs CO2 emissions in all countries except the United Kingdom; (ii) PCI-TRA and PCI-INS are ineffective in declining CO2 emissions in all countries); (iii) R&D investments are helpful in all countries except Canada and Japan; (iv) economic growth structure is not eco-friendly in all countries; (v) nuclear (renewable) energy use is beneficial in Japan (all countries except Canada & France; (vi) KRLS method provides high estimation results ∼99.2 %. Accordingly, the study discusses policy implications to prevent the ED by benefitting from productive capacity shifts, clean energy, and R&D investments in transforming economic structure.