Smart Growth or Energy Waste? The Dual Role of Human Capital Patents and Eco‐Innovation in Emerging Market Energy Efficiency

ABSTRACT The gap between economic growth and sustainability in emerging economies continues to widen due to high energy intensity, rapid urbanization, and uneven adoption of clean energy. Strengthening energy productivity is central to narrowing this gap. Although human capital and eco‐innovation are frequently cited as pathways to improved energy efficiency, their empirical role remains underexplored in settings marked by structural heterogeneity. This study evaluates how human capital and eco‐innovation shape energy productivity in 12 emerging economies from 2000 to 2021. Using the Method of Moments Quantile Regression (MMQR), the analysis captures distributional and non‐linear effects that conventional mean‐based estimators often miss. The study tests whether energy productivity exhibits threshold behavior consistent with human capital theory and the environmental Kuznets curve. The findings show that human capital follows an inverted U‐shaped relationship with energy productivity in several quantiles, suggesting that early gains taper off as economies advance. Eco‐innovation exerts a positive but context‐dependent influence, while clean energy adoption and regulatory stringency also contribute to improved productivity, though their impact reflects transitional adjustment costs and policy inertia. Robustness checks using AMG, CCEMG, and Fixed Effects confirm that demographic and structural factors—particularly population density—remain significant across specifications. Granger causality tests reveal limited short‐term causality, implying that many effects unfold over longer horizons. The results underscore the need for policy measures that align education and skill formation with energy‐sector demands, strengthen support for green innovation, and reduce the cost burden of environmental compliance to accelerate the shift toward efficient and sustainable energy systems.