ABSTRACT Technological innovation is widely recognized as a key driver of economic progress; however, its role in advancing environmental sustainability remains a subject of scholarly debate. This study investigates the determinants of green technological innovation (GTI) by examining the influence of political stability (PS) and the mediating roles of financial inclusion (FI), green investment (GI), and environmental regulations (ER) within G20 economies over the period 2004–2023. Using structural equation modeling, the analysis evaluates both direct and indirect pathways through which institutional conditions shape environmentally oriented innovation. The results indicate that political stability significantly promotes green technological innovation. Moreover, financial inclusion, green investment, and environmental regulations function as complementary transmission channels that strengthen the positive impact of political stability on GTI. These mediators facilitate resource allocation toward environmentally friendly technologies, enhance investment efficiency, and reinforce regulatory incentives for sustainable innovation. The findings highlight the importance of stable governance structures and integrated financial and regulatory frameworks in advancing sustainable development. Policymakers should therefore encourage green investment, particularly through digital financial systems, and strengthen environmental regulatory mechanisms to accelerate green innovation and support long‐term sustainability objectives.
Wen et al. (Sun,) studied this question.
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