Abstract
The twin green and digital transitions are shaping the global business environment. However, academic research exploring the financial implications of the green-digital nexus remains limited. This paper explores the financial implications of a key mechanism within the green-digital nexus: technological connectedness through knowledge creation and spillovers. Quantified through patent data between 2010 and 2022, this study examines how technology, or “tech,” firms’ financial performance is affected by knowledge creation and spillovers to “green” (clean energy) technologies and “brown” (fossil fuel) technologies. The study employs portfolio- and firm-level analyses with panel data regression models. The results indicate that, contrary to the results of aggregated-level studies in the literature, the dynamics of financial connectedness is not straightforward. While firm-level heterogeneity in knowledge creation results in abnormal returns, there is no conclusive evidence that knowledge spillovers affect tech firms’ financial performance.
