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What Triggers Environmental Management and Innovation? – Empirical Evidence for Germany

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  • Manuel Frondel

    ()

  • Jens Horbach
  • Klaus Rennings

Abstract

It is frequently hypothesized that environmental management systems (EMSs) may improve a firm’s environmental performance. Whether or not this hypothesis is true is as important from the perspective of environmental policy as questions relating to the relevant incentives for (1) a firm’s voluntary adoption of an EMS and (2) its environmental innovation behavior. Based on ample empirical evidence for German manufacturing, this paper addresses these issues on the basis of a recursive bivariate probit model that explicitly takes into account that a facility’s decision on innovation activities is correlated with the decision on EMS certification. Our empirical results indicate that environmental innovation activities are not associated with EMS certification nor any other single policy instrument. Rather, innovation behavior seems to be correlated to the stringency of environmental policy.

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Bibliographic Info

Paper provided by Rheinisch-Westfälisches Institut für Wirtschaftsforschung in its series RWI Discussion Papers with number 0015.

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Length: 29 pages
Date of creation: Jun 2004
Date of revision:
Handle: RePEc:rwi:dpaper:0015

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Related research

Keywords: Environmental Technological Change; Environmental Management Systems; Discrete Choice Models; Environmental Regulation;

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  1. Adam Jaffe & Richard Newell & Robert Stavins, 2002. "Environmental Policy and Technological Change," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 22(1), pages 41-70, June.
  2. Adam B. Jaffe & Karen Palmer, 1997. "Environmental Regulation And Innovation: A Panel Data Study," The Review of Economics and Statistics, MIT Press, vol. 79(4), pages 610-619, November.
  3. Parry, Ian & Pizer, William & Fischer, Carolyn, 1998. "Instrument Choice for Environmental Protection When Technological Innovation is Endogenous," Discussion Papers dp-99-04, Resources For the Future.
  4. Frondel, Manuel & Schmidt, Christoph M., 2001. "Evaluating environmental programs: the perspective of modern evaluation research," ZEW Discussion Papers 01-59, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  5. Frondel, Manuel & Schmidt, Christoph M., 2001. "Evaluating Environmental Programs: The Perspective of Modern Evaluation Research," IZA Discussion Papers 397, Institute for the Study of Labor (IZA).
  6. Rennings, Klaus & Ziegler, Andreas, 2004. "Determinants of Environmental Innovations in Germany: Do Organizational Measures Matter? A Discrete Choice Analysis at the Firm Level," ZEW Discussion Papers 04-30, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  7. Anton, W.R.Q.Wilma Rose Q. & Deltas, George & Khanna, Madhu, 2004. "Incentives for environmental self-regulation and implications for environmental performance," Journal of Environmental Economics and Management, Elsevier, vol. 48(1), pages 632-654, July.
  8. Rennings, Klaus, 2000. "Redefining innovation -- eco-innovation research and the contribution from ecological economics," Ecological Economics, Elsevier, vol. 32(2), pages 319-332, February.
  9. Milliman, Scott R. & Prince, Raymond, 1989. "Firm incentives to promote technological change in pollution control," Journal of Environmental Economics and Management, Elsevier, vol. 17(3), pages 247-265, November.
  10. Hoffmann, Esther & Ankele, Kathrin & Ziegler, Andreas & Rennings, Klaus & Nill, Jan, 2003. "The Influence of the EU Environmental Management and Auditing Scheme on Environmental Innovations and Competitiveness in Germany: An Analysis on the Basis of Case Studies and a Large-Scale Survey," ZEW Discussion Papers 03-14, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  11. Rennings, Klaus & Zwick, Thomas, 2001. "The employment impact of cleaner production on the firm level: empirical evidence from a survey in five European countries," ZEW Discussion Papers 01-08, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  12. Henriques, Irene & Sadorsky, Perry, 1996. "The Determinants of an Environmentally Responsive Firm: An Empirical Approach," Journal of Environmental Economics and Management, Elsevier, vol. 30(3), pages 381-395, May.
  13. Dasgupta, Susmita & Hettige, Hemamala & Wheeler, David, 2000. "What Improves Environmental Compliance? Evidence from Mexican Industry," Journal of Environmental Economics and Management, Elsevier, vol. 39(1), pages 39-66, January.
  14. Brunnermeier, Smita B. & Cohen, Mark A., 2003. "Determinants of environmental innovation in US manufacturing industries," Journal of Environmental Economics and Management, Elsevier, vol. 45(2), pages 278-293, March.
  15. Nakamura, Masao & Takahashi, Takuya & Vertinsky, Ilan, 2001. "Why Japanese Firms Choose to Certify: A Study of Managerial Responses to Environmental Issues," Journal of Environmental Economics and Management, Elsevier, vol. 42(1), pages 23-52, July.
  16. Frondel, Manuel & Horbach, Jens & Rennings, Klaus & Requate, Till, 2004. "Environmental Policy Tools and Firm-Level Management Practices : Empirical Evidence for Germany," Economics Working Papers 2004,02, Christian-Albrechts-University of Kiel, Department of Economics.
  17. Requate, Till, 1998. "Incentives to innovate under emission taxes and tradeable permits," European Journal of Political Economy, Elsevier, vol. 14(1), pages 139-165, February.
  18. Downing, Paul B. & White, Lawrence J., 1986. "Innovation in pollution control," Journal of Environmental Economics and Management, Elsevier, vol. 13(1), pages 18-29, March.
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