Green research and development activities and SO2 intensity: an analysis for China

Carrying out domestic research and development (R&D) activities can improve environmental performance. However, extant studies have not conclusively indicated that R&D activities in all energy fields lead to a reduction in the SO2 intensity. SO2 intensity is defined as the ratio of SO2 emissions to the GDP. Hence, green R&D activities are required. However, the strong heterogeneity between green R&D activities could have distinctive economic consequences. Thus, it is imperative to study the heterogeneity of green R&D activities on SO2 intensity. Moreover, previous studies have ignored regional differences. Although overlooked in the literature, a technology's adsorptive ability could be a key determinant of the effects of green R&D activities on SO2 intensity. Based on a linear analysis of China's provincial data over 2000-2016, we show that green R&D activities are instrumental in reducing SO2 intensity. Different green R&D activities have distinct goals and contrasting statistical effects on SO2 intensity. The empirical results show that the impact of green R&D activities on SO2 intensity differs by region. Lastly, it is proposed that green R&D activity effects on SO2 intensity are nonlinear by analysing a technology's adsorptive ability.