Economic Thought and Practice, , 2026.
Preliminary communication
https://doi.org/10.17818/EMIP/2026/47
ENVIRONMENTAL PROTECTION R&D AND ENVIRONMENTAL TAXES: DRIVERS OR CONSTRAINTS OF ECONOMIC GROWTH IN THE REPUBLIC OF CROATIA?
Barbara Fajdetić
orcid.org/0000-0003-0246-7491
; University of Rijeka, Faculty of Economics and Business, Croatia
*
* Corresponding author.
Abstract
Environmental degradation is one of the main obstacles to sustainable economic growth. Globalisation, rapid economic growth and development, and heavy reliance on fossil fuels pose challenges, particularly for small open economies such as Croatia. This study analyses the short- and long-run effects of environmental protection research and development (R&D) investments, government effectiveness, and environmental taxes on gross domestic product (GDP) dynamics. The empirical analysis applies the Autoregressive Distributed Lag (ARDL) bounds testing approach to the Republic of Croatia over the period 2000–2023. The results show that environmental taxes have a stable, positive, and statistically significant effect on GDP levels in both the short and the long run. After introducing a dummy variable for the year of EU accession, the long-run effect of environmental protection R&D investments is no longer statistically significant. The findings indicate the importance of including control variables to isolate the effects of environmental policies from broader macroeconomic trends.
Keywords
research and development; environmental protection; environmental taxes; economic growth
Hrčak ID:
352223
URI
Publication date:
19.10.2026.
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