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Environmental regulation and innovation in renewable energy technologies: Does the policy instrument matter?

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  • Hille, Erik
  • Althammer, Wilhelm
  • Diederich, Henning

Abstract

We examine how different renewable energy support policies affect innovation in solar and wind power technologies. The analysis uses policy and patent data for a large sample of 194 countries and territories. The policy data enables distinguishing between two dimensions of regulation, i.e. design and intensity, and their effects on innovation. The patent data is based on the new Y02E system and covers the period 1990 to 2016, with the more recent years revealing both strong increases and declines in patenting activity. The results show that, firstly, more comprehensive portfolios of renewable energy support policies increase patenting in solar- and wind-power-related technologies. Secondly, this inducement effect is strongest for public RD&D programs, targets, and fiscal incentives. In contrast to previous studies, this paper finds a consistently positive impact of feed-in tariffs and does not detect technology-specific differences in the effectiveness of this policy instrument. Thirdly, the positive effect on patenting activity increases significantly over time, with an increase in duration of the implemented RD&D programs and targets.

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  • Hille, Erik & Althammer, Wilhelm & Diederich, Henning, 2020. "Environmental regulation and innovation in renewable energy technologies: Does the policy instrument matter?," Technological Forecasting and Social Change, Elsevier, vol. 153(C).
    • Handle: RePEc:eee:tefoso:v:153:y:2020:i:c:s0040162519301520
    DOI: 10.1016/j.techfore.2020.119921
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    More about this item

    Keywords

    Innovation; Environmental regulation; Renewable energy technologies; Solar technologies; Wind technologies;
    All these keywords.

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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