Green innovation and income inequality: A complex system analysis.

The objective of this paper is to analyse the relationship between income inequality and environmental innovation. To this end, we use the Economic Fitness and Complexity algorithm to compute an index of green inventive capacity in a panel of 57 countries over the period 1970-2010. The empirical analysis reveals that, on average, inequality is detrimental to countries' capacity to develop complex green technologies. Using non-parametric methods we further articulate this general finding and uncover interesting non-linearities in the relationship between innovation and inequality.