Assessing the drivers of green growth: an empirical investigation of green technological innovation, economic complexity, and investments in renewable energy in G20 countries

As the world grapples with the long-term consequences of the changing climate and dreadful ecological conditions, the G20 nations, as the largest and most influential economies, face a particularly daunting challenge: striking the optimal balance between environmental sustainability and economic growth. Green growth is a transformative strategy, aiming to drive innovation and marking a paradigm shift in global environmental stewardship and economic development approaches. Important factors impacting green growth include the availability of resources, developments in green technologies, economic complexity and calculated clean energy investments. All of these factors have to be in line with environmental priorities. The study employed second-generation panel tests, including the Driscoll-Kraay method, to effectively address econometric challenges in panel data. The insights provide a roadmap for future sustainable development. The study identified green innovations, investment in renewable energy infrastructure, and economic complexity as key drivers of green growth, emphasizing the importance of adopting environmentally sustainable technologies. While economic complexity fosters environmental sustainability, challenges such as population growth, rising energy demand, and resource exploitation pose significant constraints. The results show a favorable and statistically significant association between long-term green growth and the development of green technologies. Specifically, with a 1% increase in environmental innovation, there is a corresponding 0.627% improvement in green growth. The elasticity coefficient is positive between economic complexity and green growth, i.e. a 1% increase in economic complexity causes green growth to rise by 0.429%. The Economic Complexity Index evaluates economic complexity with a focus on the volume and diversification of a country’s exports. To achieve a sustainable and greener future, G20 countries must prioritize green technologies, expand renewable energy adoption, and invest in sustainable energy infrastructure. Efficient resource management, strategic energy transitions, and innovation in complex economies are essential for advancing the G20’s sustainability vision and fostering the sustainable development of its member countries.