Does Distribution of Energy Innovation impact Distribution of Income: A Quantile-based SDG Modeling Approach

Despite the ongoing research on energy innovation and economic growth, little is known on how degree of energy innovation impacts income inequality within a nation. To address this research gap, we have developed a bivariate model to analyze how distribution of energy innovation affects the income distribution in a certain country. Using the Fisher Ideal Index, we have calculated energy efficiency as an indicator of energy innovation. Quantile-on-Quantile regression has been applied to capture the impact on energy innovation across different income quantiles in Next 11 (N11) countries. Results show that energy innovation can have different outcomes, across the member countries of N11 group, namely a) equitable and positive impact, (b) negative impact, and (c) inequitable impact in terms of distribution of income. We have inferred important policy implications, which might lead to sustainable development strategies in N11 countries. This study is one of the first to establish the direct link between energy innovation and income inequality across different quantiles within a nation. Further, we successfully demonstrate the application of advanced quantile methods in inferring Sustainable Development Goal (SDG) focused policy implications.