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The impact of government-funded renewable energy R&D on its consumption

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  • Herzer, Dierk

Abstract

With the increasing urgency to shift away from fossil fuels, many governments are boosting their funding for renewable energy research and development (R&D). The fundamental premise behind these efforts is that government-funded renewable energy R&D contributes to increased consumption of renewable energy. This paper examines this premise employing panel data from 26 countries between 1974 and 2022. Based on panel cointegration methods and panel causality tests, this study finds robust evidence of a statistically significant positive long-term relationship between government-funded renewable energy R&D and renewable energy consumption. It also identifies unidirectional causality running from the former to the latter.

Suggested Citation

  • Herzer, Dierk, 2025. "The impact of government-funded renewable energy R&D on its consumption," Journal of Policy Modeling, Elsevier, vol. 47(5), pages 903-918.
    • Handle: RePEc:eee:jpolmo:v:47:y:2025:i:5:p:903-918
    DOI: 10.1016/j.jpolmod.2025.06.001
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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