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Legislative fractionalization and partisan shifts to the left increase the volatility of public energy R&D expenditures

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  • Baccini, Leonardo
  • Urpelainen, Johannes

Abstract

This article shows that legislative fractionalization and leftward (but not rightward) partisan shifts increase the volatility of public R&D expenditures in new energy technologies. We develop a highly accurate estimator for public energy R&D expenditures, and examine deviations from the estimated values using data for member states of the International Energy Agency, 1981-2007. Given that unpredictable fluctuation in public spending on new energy technology reduces the positive effect of such spending on innovation, our empirical analyses imply that countries with fractionalized legislatures can improve the performance of their energy technology programs through institutional mechanisms that reduce the volatility of public spending. Similarly, the results indicate that left-wing and right-wing governments can improve the performance of public technology programs through agreements that distribute gains in such a fashion that partisan shifts do not cause spending cuts. Contravening the conventional wisdom, we also find that public energy R&D is unusually stable in the United States.

Suggested Citation

  • Baccini, Leonardo & Urpelainen, Johannes, 2012. "Legislative fractionalization and partisan shifts to the left increase the volatility of public energy R&D expenditures," LSE Research Online Documents on Economics 45571, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:45571
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    File URL: http://eprints.lse.ac.uk/45571/
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    Cited by:

    1. repec:gam:jeners:v:10:y:2017:i:12:p:2131-:d:122976 is not listed on IDEAS
    2. David Popp, 2015. "Using Scientific Publications to Evaluate Government R&D Spending: The Case of Energy," CESifo Working Paper Series 5442, CESifo Group Munich.
    3. repec:eco:journ2:2018-02-2 is not listed on IDEAS
    4. Brutschin, Elina & Fleig, Andreas, 2016. "Innovation in the energy sector – The role of fossil fuels and developing economies," Energy Policy, Elsevier, vol. 97(C), pages 27-38.
    5. David Popp, 2015. "Using Scientific Publications to Evaluate Government R&D Spending: The Case of Energy," NBER Working Papers 21415, National Bureau of Economic Research, Inc.
    6. Raphael Bointner & Simon Pezzutto & Gianluca Grilli & Wolfram Sparber, 2016. "Financing Innovations for the Renewable Energy Transition in Europe," Energies, MDPI, Open Access Journal, vol. 9(12), pages 1-16, November.
    7. repec:gam:jsusta:v:9:y:2017:i:4:p:617-:d:95887 is not listed on IDEAS
    8. Raphael Bointner & Simon Pezzutto & Wolfram Sparber, 2016. "Scenarios of public energy research and development expenditures: financing energy innovation in Europe," Wiley Interdisciplinary Reviews: Energy and Environment, Wiley Blackwell, vol. 5(4), pages 470-488, July.

    More about this item

    Keywords

    public energy R&D; volatility; legislative politics;

    JEL classification:

    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General

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