Exploring the Influence of Innovation and Technology on Climate Change

Abstract

Considering the negative effect of anthropological activities on climate in recent decades, all countries entailed a universal commitment to fight against climate change by boosting innovation and introducing new technologies. In this context, our paper aimed to investigate the impact of innovation input in terms of research and development (R&D) costs and technology expressed as technical equipment and machinery (TEM) on the reported greenhouse gas (GHG) emissions in chemical industry companies in five Central and Eastern European countries. This study employed a panel regression model with fixed effects and covered data from 2015 to 2020. The empirical results emphasize a negative relationship between R&D costs and GHG emissions, indicating the companies’ commitment to developing innovative solutions that contribute to lower destructive emissions. Additionally, the findings related to the influence of TEM on GHG emissions reveal a positive impact, highlighting the need to improve manufacturing technologies. The practical implications of our findings can be meaningful for both policymakers and businesses operating in the chemical industry in developing countries. Policymakers should offer financial incentives to support research and investments in clean technologies, while businesses should prioritise such investments to mitigate GHG emissions.

Keywords

• innovation
• technology
• greenhouse gas (GHG) emissions
• research and development (R&D) costs
• technical equipment and machinery
• chemical industry