Will income inequality influence the abatement effect of renewable energy technological innovation on carbon dioxide emissions?

Environmental pollution and income inequality have become two salient issues in China. To achieve a green economic transformation, China urgently needs to develop renewable energy technologies to reduce carbon dioxide (CO₂) emissions. However, the relationship among income inequality, renewable energy technological innovation (RETI) and CO₂ emissions has not received sufficient attention in the current literature. Based on Chinese provincial panel data from 2000 to 2015, this paper adopts a panel fixed effect regression model and a panel threshold model to perform an analysis on the nonlinear relationship among these factors. The results show that (1) RETI is conducive to reducing per capita CO₂ emissions (PCE). However, with an increase in income inequality, the abatement effect of RETI on per capita CO₂ emissions will be hindered, and RETI will even positively contribute to PCE. (2) The panel threshold model shows that the impact of RETI on PCE has a significant single-threshold effect with regard to income inequality. When income inequality is lower than the threshold value, the impact of RETI on PCE is not significant. However, above the threshold value, that is, within the interval of higher income inequality, an increase in RETI will positively contribute to PCE. Finally, from the perspectives of income inequality and RETI, relevant policy implications are put forward for achieving the transformation of a low-carbon economy.