Nexus of innovation, gross domestic product, CO2, and renewable energy in China

Abstract

This study investigates the dynamic nexus between renewable energy (RE) consumption, economic growth (EG), carbon dioxide emissions (CO₂), innovation (INN), and trade openness (TO) in China from 2000 to 2023. Unlike many previous studies that rely on ordinal innovation indices, this study employs a more robust proxy — R&D expenditure as a percentage of GDP — to capture the impact of technological innovation on RE use. Using a log–log econometric model and time-series data, the results show that EG and innovation significantly boost RE consumption, while CO₂ emissions exert a negative influence. These findings support the Environmental Kuznets Curve (EKC) hypothesis and the Energy Transition Theory. The study offers critical insights for policy, suggesting that sustained investment in R&D and innovation ecosystems is essential for scaling up RE and achieving long-term carbon neutrality in China.