The Role of Central Bank Monetary Policy on Green Innovation : An empirical analysis on the impact of real policy rates on green innovation among OECD countries

Abstract

This thesis investigates the relationship between policy rates and green innovation among OECD countries. The study uses patent application data as a proxy for innovation and examines the impact of real policy rates on the level and ratio of green innovation. The results of the analysis show that there is a negative relationship between central bank policy rates and green innovation, indicating that higher real policy rates may hinder the development of green technologies. The study also finds that the impact of real policy rates on green innovation varies by subcategory, with some subcategories being more sensitive to changes in the real policy rates than others. Overall, the study provides evidence that central bank monetary policy can have an impact on the development of green technologies.