Climate target announcements as catalysts for artificial intelligence advancement

A growing number of countries and regions have announced climate targets, yet the potential unintended implications of these initiatives for artificial intelligence (AI) advancement remain underexplored. Using panel data from 241 countries and regions over 2014 to 2021, we treat the climate target announcement as a quasi-natural experiment and employ a Staggered Difference-In-Differences model to examine the impacts of climate target announcements on AI advancement. Results reveal that the policy signal effects of climate target announcements significantly accelerate AI advancement, with climate neutrality goals exhibiting the strongest effect. The mechanisms driving this relationship include increased investment in AI-related sectors and enhanced electrification based on renewable energy sources. The effect is more pronounced in countries and regions with more developed digital infrastructure, higher innovation investment, larger energy consumption, and a higher share of renewable energy use. Further analysis indicates that climate target announcements are linked to greener applications of AI, and the subsequent pattern of AI advancement is consistent with lower emissions and progress toward climate goals. In addition, we find limited evidence that institutional factors materially shape these relationships, and the effects of climate target announcements on AI advancement appear persistent over time. Moreover, neither climate target announcements nor AI advancement shows a robust association with income inequality. Based on these findings, we recommend earlier announcements of climate target as policy signals to encourage sustained AI advancement, and calls for policy support to integrate climate objectives with intelligent technologies so as to achieve synergistic gains in sustainable development.