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Energy, the Environment, and Innovation

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  • Michael Grubb
  • David Ulph

Abstract

In this paper we review the theoretical and empirical literature on the role of policies in stimulating innovation that is designed to produce greener and more energy-efficient technologies. First we review the theoretical literature on the role of purely environmental policies in inducing firms to undertake environmental innovation. The conclusion is that for a wide range of policies and in a wide range of circumstances one cannot prove that these policies necessarily induce greater innovation. We then consider the empirical evidence, which suggests that the effect of these policies is weak but that the largest effects come in the long run when, through learning-by-doing, firms better understand the scope and potential for new energy-efficient technologies. Finally we consider the design of both environmental and technology policies, and show that the interaction of these policies is complex and warrants considerable further research. Copyright 2002, Oxford University Press.

Suggested Citation

  • Michael Grubb & David Ulph, 2002. "Energy, the Environment, and Innovation," Oxford Review of Economic Policy, Oxford University Press, vol. 18(1), pages 92-106, Spring.
  • Handle: RePEc:oup:oxford:v:18:y:2002:i:1:p:92-106
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Bleischwitz, Raimund & Andersen, Lars-Morten, 2009. "Informational Barriers to Energy Efficiency – Theory and European Policies," MPRA Paper 19937, University Library of Munich, Germany.
    2. Tilmann Rave & Ursula Triebswetter & Johann Wackerbauer, 2013. "Koordination von Innovations-, Energie- und Umweltpolitik," ifo Forschungsberichte, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 61, October.
    3. Bleischwitz, Raimund & Bader, Nikolas & Dannemand, Per & Nygaard, Anne, 2008. "EU Policies and Cluster Development of Hydrogen Communities," MPRA Paper 14501, University Library of Munich, Germany.
    4. Lehmann, Paul & Gawel, Erik, 2013. "Why should support schemes for renewable electricity complement the EU emissions trading scheme?," Energy Policy, Elsevier, vol. 52(C), pages 597-607.
    5. Raymond J.G.M. Florax & Henri L.F. de Groot & Peter Mulder, 2011. "Energy Efficiency and Technological Change," Chapters,in: Improving Energy Efficiency through Technology, chapter 1 Edward Elgar Publishing.
    6. Bleischwitz, Raimund & Bader, Nikolas, 2010. "Policies for the transition towards a hydrogen economy: the EU case," Energy Policy, Elsevier, vol. 38(10), pages 5388-5398, October.
    7. Lehmann, Paul, 2008. "Using a Policy Mix for Pollution Control – A Review of Economic Literature," MPRA Paper 21354, University Library of Munich, Germany.
    8. Borghesi, Simone & Cainelli, Giulio & Mazzanti, Massimiliano, 2015. "Linking emission trading to environmental innovation: Evidence from the Italian manufacturing industry," Research Policy, Elsevier, vol. 44(3), pages 669-683.
    9. Kesidou, Effie & Demirel, Pelin, 2012. "On the drivers of eco-innovations: Empirical evidence from the UK," Research Policy, Elsevier, vol. 41(5), pages 862-870.
    10. Massimiliano Mazzanti & Roberto Zoboli, 2006. "Examining the Factors Influencing Environmental Innovations," Working Papers 2006.20, Fondazione Eni Enrico Mattei.
    11. Ricci, Francesco, 2007. "Channels of transmission of environmental policy to economic growth: A survey of the theory," Ecological Economics, Elsevier, vol. 60(4), pages 688-699, February.
    12. Olivier Godard, 2007. "Climat et générations futures - Un examen critique du débat académique suscité par le Rapport Stern," Working Papers hal-00243059, HAL.
    13. Nicholas Howarth, 2011. "Clean Energy Technology and the Role of Non-Carbon Price-Based Policy: An Evolutionary Economics Perspective," European Planning Studies, Taylor & Francis Journals, vol. 20(5), pages 871-891, October.
    14. Timothy J. Foxon & Jonathan Köhler & Jonathan Michie & Christine Oughton, 2013. "Towards a new complexity economics for sustainability," Cambridge Journal of Economics, Oxford University Press, vol. 37(1), pages 187-208.
    15. Bergek, Anna & Berggren, Christian, 2014. "The impact of environmental policy instruments on innovation: A review of energy and automotive industry studies," Ecological Economics, Elsevier, vol. 106(C), pages 112-123.
    16. Giulio Cainelli & Massimiliano Mazzanti & Roberto Zoboli, 2011. "Enviromental Innovations, Complementarity and Local/Global Cooperation," Working Papers 201104, University of Ferrara, Department of Economics.

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