Pathways to an equitable low-carbon future: The nexus of climate policy, emerging technologies, and just transitions

Abstract

At the cost of social equity, advanced economies often make biased climate polices that target mostly emission reduction, which cause uneven benefits and inequality. This paper bridges this gap by investigating the impact of climate policy and technological innovation on the transition into a low-carbon economy in the G7 countries. The study uses Driscoll-Kraay error and Dumitrescu-Hurlin causality tests to examine the effect of renewable energy output (REO), Energy Intensity (ENU), Internet Usage (INT), and research and development (RND) on Just Transition Index (JTI), which measures income inequality, energy poverty, and air pollution. The results reveal that REO enhances just transition performance, suggesting that climate policies through renewable energy expansion foster decarbonization and social inclusion. ENU also shows a positive effect; this suggests that improved energy access enhances living standards. INT has the largest impact, confirming the role emerging in reducing inequity. The study concludes that equitable low-carbon transition in advanced economies requires integrated strategies aligning climate policies, emerging technologies, and energy access policies to ensure that efforts towards sustainability create fairness rather than increase inequalities.