Towards Sustainable Development: Assessing the Significance of World Uncertainty in Green Technology Innovation

This paper uses the two-way fixed effects model to empirically examine the impact of the World Uncertainty Index (WUI) on Green Patents (GPs). Quantitative results indicate that WUI negatively affects GPs, meaning that world uncertainty significantly hinders green technology innovation. This effect is mediated through relaxed environmental regulation and reduced financial support. These findings underline that increased uncertainty decreases both the variables of environmental regulation and financial support, thus delaying the innovation of green technology. Low-income countries’ weak economic and technological bases have a statistically insignificant negative impact on GP. However, a statistically significant negative impact is indicated for high-income countries, reflecting their higher sensitivity to world uncertainties. The WUI’s more negative effect on GPs is experienced in middle-income countries due to continuous economic and technological development and less adaptability.