Does Public Spending upon Science and Technology and State Income Affect Environmental Quality?

The Environmental Kuznets Curve (EKC) hypothesis suggests that economic growth and environmental quality have a significant relationship between them. Similarly, government expenditure on science and technology has an impact on carbon emissions, but it's not always a straightforward relationship. Therefore, carbon emissions are complex and often varies by context, including the stage of development of an economy, its industrial base, and its energy sources. The present study employed panel data econometric methodology to examine the long-run relationships among science and technology ( ST ), state income ( GSDP ), and carbon emission ( CO 2 ) over the period from 2008–2009 to 2022–2023 in 16 major states of India. The Westerlund cointegration test result shows that there exists a long-term stable relationship among ST , GSDP , and CO 2 in Indian states during this period. The study also applied the PMG-ARDL model where the result shows that GSDP is unable to impact CO 2 emissions both in the short run and long run, thus refuting the EKC hypothesis. On the other hand, there is a direct impact of ST on CO 2 emissions in the long run for these states. A one crore rupee increase in government expenditure on ST leads to an increase in CO 2 emissions by 0.78 metric tonnes. The findings appear to support the Jevons’ paradox that investment in ST creates a rebound effect, resulting in further carbon emissions. Finally, the coefficient of ECT (error correction term) is negative (−0.0668), which implies the speed of convergence towards long-run stable position from short-run dispersion is 6% per annum in Indian states.