Energy R&D, IPR and environmental sustainability in OECD economies: a quantile-based analysis

Abstract

Existing studies on environmental sustainability treat innovation monolithically, failing to distinguish between innovation inputs (energy R&D) and outputs (intellectual property rights). This study disaggregates innovation inputs from outputs to examine their heterogenous effects on environmental sustainability (ENS) across 21 OECD economies from 2011–2023. Using Method of Moments Quantile Regression (MMQR) on a balanced panel of 273 observations, we find that a 1% increase in energy R&D enhances ENS by 0.015–0.018 points, with stronger effects in low-sustainability countries (a ‘low-hanging fruit’ effect). Conversely, a 1% increase in patent application reduces ENS by 0.016–0.020 points, indicating that current IPR systems remain commercially rather than ecologically oriented. Renewable energy consumption yields positive but diminishing marginal benefits. These findings imply that policy makers must reform IPR regimes to prioritize green patents and tailor policy mixes to each country’s sustainability level.