Patents, fossil fuels, foreign direct investment, and carbon dioxide emissions in South Korea

We explore the relationship between carbon dioxide (CO2) emissions, fossil fuels energy consumption (FE), home patents (HP), foreign patents (FP), foreign direct investment (FDI), and Gross Domestic Product (GDP) in South Korea over the period 1980-2018 by employing the autoregressive distributed lag (ARDL) approach. Results reveal that FE, HP, and GDP have positive impacts on CO2 emissions, while FP have a negative impact. Furthermore, FE and FP act positively on GDP, whereas HP and CO2 emissions act negatively on it. In addition, HP, FDI, and GDP have positive effects on FP, and FE harms FP. Granger causality findings reveal that in the long run there will be two-way causality between CO2 emissions, GDP, HP, and FE, while, in the short run, there is one-way causality running from HP, FE, and FP to GDP; from FP to HP; from HP and FP to FE, and from HP and FP to CO2 emissions. Since foreign patents enhance environmental quality and boost economic growth, the South Korean government should encourage the use of foreign patents and promote clean technology home patents.