Measuring national progress toward green transformation remains challenging due to fragmented assessment frameworks. This study develops and validates a Green Transformation Index that captures the capacity for sustainability transitions by integrating resource efficiency, innovation systems, and policy instruments. Using OECD Green Growth Indicators covering 58 economies from 2017 to 2025, we construct a composite index from 47 standardized indicators organized into three theoretically grounded dimensions. The GTI measures transformation capacity through innovation investment and policy frameworks rather than environmental outcomes. Results reveal substantial heterogeneity in transformation capacity with a Gini coefficient of 0.283, indicating persistent global inequality. Temporal analysis identifies a three-phase trajectory: consolidation from 2017 to 2019, acceleration during 2021 to 2023 driven by green recovery investments, and marked reversal in 2024 to 2025, highlighting vulnerability to economic shocks. Cluster analysis identifies four distinct pathways: innovation-driven, balanced integration, resource-first, and policy-led approaches. Critical findings show only 19 percent of countries demonstrate strong coordination between innovation investments and policy instruments, revealing significant governance fragmentation. Validation tests confirm the index effectively measures innovation capacity but shows weak correlation with emissions outcomes, underscoring the distinction between transformation inputs and environmental performance.
Balcıoğlu et al. (Mon,) studied this question.