IS ENVIRONMENTAL INNOVATION INCREASING RENEWABLE ENERGY CONSUMPTION? AN EMPIRICAL APPLICATION ON TURKEY ECONOMY

Abstract

Sustainable economic growth and development in national economies are among the most important macroeconomic targets. Energy is among the most important inputs for the realization of economic growth. Renewable energy has strategic importance especially in the Turkish economy, which has scarce resources in terms of energy obtained from fossil fuels. Innovative activities that ensure low carbon emissions in terms of the impact of economic growth on the environment are expressed as environmental innovation. In this study, the relationship between environmental innovation and renewable energy consumption in the 1990-2018 sample period in the Turkish economy is examined. Economic growth and foreign direct investment variables were added as control variables to the model in which the said relationship was examined. The unit root process of the variables in the model was examined with the ADF unit root test. The long-run relationship between these variables Pesaran et al. (2001) developed by ARDL boundary test. ARDL bounds test findings revealed the existence of a cointegration relationship. In order to determine the consistency of the cointegrating coefficients, both ARDL and FMOLS and CCR estimators were used. According to the findings; Increases in environmental innovation, economic growth and foreign direct investment variables cause a reduction in renewable energy consumption.