Renewables and Innovation - Empirical Assessment and Theoretical Considerations
AbstractThis study is about structural change in the energy system. In a first step an econometric model is presented and in a second step diffusion of GTs is embedded theoretically. By focusing on different green technology industries (GT sector) in Germany, we analyze how policy induced demand stimulates innovation. Taking the size of the market as a proxy for demand and patent counts as a proxy for innovation, we find support that the presence of institutions enabling diffusion of GTs are correlated with innovative activity. Public R&D expenditures also play a significant role. We additionally control for a structural break by comparing the two institutional settings incorporated into the legal system in Germany, namely the Stromeinspeisegesetz (SEG) and the Erneuerbare Energiengesetz (EEG). We cannot find support for the supposition that innovative activity significantly differs for diffusion under the SEG and EEG. The empirical findings also show that electricity prices are not the driving force for innovative activity within the GT sector. The discussion at the end of the paper comes to the result that diffusion of GTs - under the EEG - is difficult to be justified theoretically.
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Bibliographic InfoPaper provided by Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics in its series Jena Economic Research Papers with number 2010-002.
Date of creation: 15 Jan 2010
Date of revision:
Renewable Energies; Demand Pull; Structural Change;
Find related papers by JEL classification:
- L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
- O31 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
- O32 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Management of Technological Innovation and R&D
- Q01 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Sustainable Development
- Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-01-30 (All new papers)
- NEP-ENE-2010-01-30 (Energy Economics)
- NEP-INO-2010-01-30 (Innovation)
- NEP-KNM-2010-01-30 (Knowledge Management & Knowledge Economy)
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