Vol. 13 (2026)

Review Articles

The synergy of digital innovation and green economy: A systematic review of mechanisms, challenges, and adaptive strategies in the post-Al era

Published 2026-01-31

  • Rafael Santos
    • ,
  • Maria Isabel Reyes

Rafael Santos
University of the Philippines Diliman image/svg+xml

Maria Isabel Reyes
Ateneo de Manila University image/svg+xml

Abstract

Digital transformation and the green transition increasingly co-evolve through shared infrastructures (data, energy, and institutions), yet their interaction is not automatically synergistic. This review synthesizes peer-reviewed research and authoritative institutional reports to clarify how digital technologies—especially AI, analytics, and platform infrastructures—shape green economic outcomes, and how environmental constraints and governance feedback reshape digital diffusion. We organize evidence around four domains: (i) labor-market restructuring under AI and digitalization, with attention to wage polarization, rents, and institutional mediators; (ii) skills mismatch and SME adoption constraints as a binding bottleneck for inclusive digital-green upgrading; (iii) the convergence of green finance and computing, where automated ESG assessment expands monitoring capacity but also amplifies measurement divergence and greenwashing risks; and (iv) sustainable infrastructure and energy transition, focusing on hydrogen value chains and the energy footprint of digital systems (data centers and AI workloads). A sectoral case—digital tourism—illustrates both substitution potential (virtual experiences, demand management) and rebound risks. Evidence converges on a conditional-synergy thesis: digital tools can accelerate green innovation and emissions reductions when coupled with credible standards, auditability, clean power, and workforce capability building; absent these complements, digitalization may increase electricity demand, widen inequality, and incentivize strategic disclosure. The review identifies three research gaps that limit policy inference: long-horizon causal evidence on non-linear coupling between digitalization and decarbonization, joint modeling of distributional outcomes and environmental performance, and integrated evaluation of AI-enabled sustainable finance under heterogeneous disclosure regimes. We propose a future agenda that prioritizes enforceable AI governance, life-cycle carbon accounting across hydrogen supply chains, and targeted SME capability policies.

Keywords

digital transformation, artificial intelligence, green finance, greenwashing, hydrogen, rebound effect, SMEs, sustainable tourism, built environment

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