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Do Green Innovations Stimulate Employment? Firm-level Evidence From Germany. WWWforEurope Working Paper No. 53

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  • Georg Licht
  • Bettina Peters

    (Centre for European Economic Research)

Abstract

This paper studies the impact of environmental innovation on employment growth in the period 2006-2008 using firm-level data for German manufacturing and services. It extends the model by Harrison et al. (2008) in order to distinguish between employment effects of environmental and non-environmental product as well as process innovation. As a robustness check patent data on green technologies are employed. The results demonstrate that both environmental and non-environmental product innovations stimulate employment growth. We find a similar gross employment effect of both types of product innovations. That is, 1 percent increases in sales stemming from new environmental and non-environmental products increase gross employment by 1 percent each. Thus, we do not find evidence that new products with environmental benefits for consumers are produced with higher or lower efficiency than old products. Yet, the net employment contribution of non-green product innovations is 4 to 5 times higher than the net contribution of green product innovations. This is the result of differences in the average innovation engagement and innovation success of both types of new products. In contrast, environmental and non-environmental process innovation plays only a little role for employment growth. In particular, we do not identify a significant trade-off between more environmental-friendly production technologies and employment growth. This holds for both cleaner production technologies and end-of-pipe technologies.

Suggested Citation

  • Georg Licht & Bettina Peters, 2014. "Do Green Innovations Stimulate Employment? Firm-level Evidence From Germany. WWWforEurope Working Paper No. 53," WIFO Studies, WIFO, number 47155, February.
    • Handle: RePEc:wfo:wstudy:47155
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    References listed on IDEAS

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    Cited by:

    1. Karl Aiginger, 2016. "New Dynamics for Europe: Reaping the Benefits of Socio-ecological Transition – Part I: Synthesis. WWWforEurope Deliverable No. 11," WIFO Studies, WIFO, number 58791, April.
    2. Jens Horbach & Markus Janser, 2016. "The role of innovation and agglomeration for employment growth in the environmental sector," Industry and Innovation, Taylor & Francis Journals, vol. 23(6), pages 488-511, August.
    3. Kurt Bayer, 2015. "Institutional Set-up and Conflict Resolution – Implementation of the WWWforEurope Transition Strategy. WWWforEurope Working Paper No. 99," WIFO Studies, WIFO, number 58256, April.
    4. Consoli, Davide & Marin, Giovanni & Marzucchi, Alberto & Vona, Francesco, 2016. "Do green jobs differ from non-green jobs in terms of skills and human capital?," Research Policy, Elsevier, vol. 45(5), pages 1046-1060.
    5. Jens Horbach & Christian Rammer, 2020. "Circular economy innovations, growth and employment at the firm level: Empirical evidence from Germany," Journal of Industrial Ecology, Yale University, vol. 24(3), pages 615-625, June.
    6. Sandra M. Leitner, 2018. "Eco-Innovation: Drivers, Barriers and Effects – A European Perspective," wiiw Working Papers 159, The Vienna Institute for International Economic Studies, wiiw.
    7. Serenella Caravella & Francesco Crespi, 2022. "On the growth impact of different eco-innovation business strategies," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 39(2), pages 657-683, July.
    8. Nicolò Barbieri & Claudia Ghisetti & Marianna Gilli & Giovanni Marin & Francesco Nicolli, 2016. "A Survey Of The Literature On Environmental Innovation Based On Main Path Analysis," Journal of Economic Surveys, Wiley Blackwell, vol. 30(3), pages 596-623, July.
    9. Horbach, Jens & Rammer, Christian, 2019. "Employment and performance effects of circular economy innovations," ZEW Discussion Papers 19-016, ZEW - Leibniz Centre for European Economic Research.
    10. Janser, Markus, 2018. "The greening of jobs in Germany : First evidence from a text mining based index and employment register data," IAB-Discussion Paper 201814, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    11. David Bailey & Lisa de Propris & Jürgen Janger, 2015. "Industrial and Innovation Policy as Drivers of Change. WWWforEurope Deliverable No. 9," WIFO Studies, WIFO, number 58412, April.
    12. Georg Licht & Bettina Peters & Christian Köhler & Franz Schwiebacher, 2014. "The Potential Contribution of Innovation Systems to Socio-Ecological Transition. WWWforEurope Deliverable No. 4," WIFO Studies, WIFO, number 47502, April.

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