The Role of Digitalization, Industrialization and Green Innovation in the Green Growth Process: A GMM Panel VAR Approach

Abstract

This study aims to investigate the influence of digitalization, industrialization and green innovation development, along with economic and environmental determinants on the green growth process. A dataset containing OECD countries from 2000 to 2022 utilizes a generalized method of moments (GMM) Panel VAR approach. This study also employs the panel Granger causality test. The findings of this study indicate that there is a significantly positive effect of green innovation development on the green growth process. There exists a significant positive association and causality between digitalization, industrialization and green growth. These findings carry substantial policy implications for the development and implementation of strategies that promote green growth and environmental-friendly innovation. Consequently, policymakers should prioritize integrating green innovation and adaptive measures in their sustainable development agendas to foster a greener, more resilient future. Therefore, this study offers important insights into the dynamic interplay among digitalization, industrialization, green innovation, and green growth, thus providing policymakers with actionable strategies to navigate the intersection of technological advancement and environmental sustainability toward a greener future. Moreover, this study also contributes to the existing literature by providing a nuanced understanding and actionable policy recommendations for policymakers and stakeholders seeking to navigate the evolving landscape of green growth amidst rapid technological and industrial transformations

Keywords

• Green Growth
• Green innovation
• Digitalization
• Industrialization
• GMM P-VAR model.

References

1. Agan, B. (2024). The role of digitalization, industrialization and green innovation in the green growth process: A GMM panel VAR approach. The Eurasia Proceedings of Science, Technology, Engineering & Mathematics (EPSTEM), 27, 228-238.