Carbon Emissions in OECD Economies: The Roles of Green Innovation, Energy Transition, and Environmental Taxation

This article explores the key factors influencing carbon dioxide (CO 2 ) emissions in 35 OECD countries from 1990 to 2019. The analysis considers economic growth gross domestic product (GDP), green technological innovation (GTI), renewable energy consumption (REC), fossil energy consumption (FEC), and environmental taxation (ETAX). The study period captures the effect of major climate agreements and energy policy changes while avoiding distortions from post-2019 events such as the COVID-19 pandemic. To ensure reliability, the study applies panel econometric techniques that correct for cross-sectional dependence, heterogeneity, and endogeneity. The findings reveal that GDP growth and fossil fuel reliance raise emissions, whereas technological innovation and renewable energy reduce them. Environmental taxes show a positive but insignificant impact, possibly due to overlapping schemes like emissions trading, renewable subsidies, and tax exemptions for heavy industries. These results highlight the need to strengthen the design of environmental tax systems while promoting innovation and clean energy to achieve long-term emission cuts. The evidence contributes to understanding the drivers of CO 2 emissions in OECD economies and supports the formulation of integrated energy and climate policies.