POLİCY MİX İN THE TRANSİTİON TO RENEWABLE ENERGY: ENERGY TAXES, FİNANCİAL DEVELOPMENT, AND GREEN INNOVATİON
DOI:
https://doi.org/10.18623/rvd.v23.6368Keywords:
Renewable Energy Consumption, Green İnnovation, Energy Taxes, Financial Development, Panel Data Analysis, Cross-Sectional Dependence, OECD Countries, Second-Generation Econometric MethodsAbstract
This study examines the effects of green innovation, energy taxes, and financial development on renewable energy consumption in selected OECD countries. The analysis is based on a panel dataset covering the period 2002–2021 and consisting of nine countries with high levels of renewable energy consumption. In the study, second-generation panel data methods are employed, taking into account cross-sectional dependence and coefficient heterogeneity. In this context, cross-sectional dependence and homogeneity tests are first conducted, followed by the Fourier KPSS unit root test to examine the stationarity properties of the series. The existence of a long-run relationship is analyzed using the LM Bootstrap and the Westerlund and Edgerton (2008) panel cointegration tests. In the final stage, long-run coefficients are estimated using the Common Correlated Effects (CCE) and Dynamic Common Correlated Effects (DCCE) estimators. The findings reveal the existence of a long-run cointegration relationship among the variables. It is determined that the effect of green innovation on renewable energy consumption varies across countries, while financial development is significant only in certain countries. In contrast, energy taxes are found to have a negative impact on renewable energy consumption both across the panel and in some individual countries. This result indicates that the effectiveness of energy taxes and their policy design should be reconsidered. Overall, the findings suggest that renewable energy policies should be designed within a holistic framework that takes into account country-specific dynamics.
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