🤖 AI Summary
This study addresses the persistent contradictions in empirical assessments of climate and innovation policies by recognizing that the relationship between carbon emissions and economic growth exhibits dynamic heterogeneity during socio-technical transitions—a dimension often overlooked in existing literature. To resolve this, the paper proposes a novel analytical paradigm that operationalizes the theoretical concept of institutional regimes from transition theory by first identifying empirically grounded climate transition mechanisms. Integrating time-varying response analysis, latent variable modeling, and panel data methods within a hybrid econometric–machine learning framework, the authors develop a conditional diagnostic approach. Applying this framework to data from approximately 150 countries over 1991–2022, they successfully uncover distinct mechanisms governing the carbon–economy nexus, each characterized by unique stability and reconfiguration properties, thereby laying a foundation for more precise policy evaluation and forecasting.
📝 Abstract
Understanding how climate and innovation policies perform during socio-technical transitions remains a central challenge in innovation studies. Empirical analyses of the relationship between economic growth and carbon emissions continue to yield conflicting results, partly because they rely on pooled models that implicitly assume stable and homogeneous dynamics. Transition theory, by contrast, emphasizes that decarbonization unfolds through heterogeneous regimes characterized by varying degrees of stability, inertia, and reconfiguration. Yet, empirical tools capable of identifying these regimes prior to policy evaluation or forecasting remain limited. This paper introduces a regime-diagnostic framework designed to condition empirical analysis on the structural state of the climate-economy system. Rather than estimating causal effects or generating forecasts directly, the framework reconstructs latent transition regimes from the time varying responsiveness of emissions to economic activity. These diagnostics are used as a pre-modeling step, allowing econometric and machine learning tools to be applied conditionally on empirically identified regimes. Using a global panel of approximately 150 countries over the period 1991-2022, we apply the framework to the emission-growth relationship.