Cross-national sanctions and green innovation: Worldwide investigation

Abstract

Research background: Cross-national sanctions are external factors with high uncertainty. The current situation of green innovation is not optimistic and the future of the uncertain development is worth exploring.

Purpose of the article: This study intends to investigate how cross-national sanctions affect green innovations by examining data from 130 countries from 1990 to 2020. We use six different forms of sanctions (including those from the U.S., EU, UN, as well as unilateral, plurilateral, and economic sanctions) as the primary explanatory variables, with environmental management innovations serving as a proxy for green innovations.

Methods: Difference-in-Difference (DID) technique; Logit model.

Findings & value added: The number of environmental management inventions produced by a nation's inventors is negatively affected by plurilateral and economic sanctions, as well as by the US and the EU sanctions, while other types of sanctions have weaker effects. In terms of sub-indicators, plurilateral and the US sanctions have a serious negative impact on air pollution control and water pollution control inventions, while plurilateral, The EU and economic sanctions have a negative impact on waste management innovations. However, unilateral and the UN sanctions have no apparent effect on any type of environmental technology. Further logit model tests show that the US and economic sanctions lead to a decrease in green innovations. Moreover, the difference between Asian and African countries is that the negative effects of plurilateral, the U.S., the EU, and economic sanctions are more obvious in African countries, while cross-national sanctions have no significant impact on Asian countries. The results of our study should help countries under sanctions to respond more effectively to environmental progress.

Keywords

difference-in-difference model, green innovation, cross-national sanction

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