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Competitive Advantage in the Renewable Energy Industry: Evidence from a Gravity Model

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  • Onno Kuik

    () (IVM, VU Amsterdam)

  • Frédéric Branger

    () (CIRED)

  • Philippe Quirion

    () (CIRED, CNRS)

Abstract

Pioneering domestic environmental regulation may foster the creation of new eco-industries. These industries could benefit from a competitive advantage in the global market place. This article examines empirical evidence of the impact of domestic renewable energy policies on the export performance of renewable energy products (wind and solar PV). We use a gravity model of international trade with a balanced dataset of 49 (for wind) and 40 (for PV) countries covering the period 1995-2013. The stringency of renewable energy policies are proxied by installed capacities. Our econometric model shows evidence of competitive advantage positively correlated with domestic renewable energy policies, sustained in the wind industry but brief in the solar PV industry. We suggest that the reason for the dynamic difference lies in the underlying technologies involved in the two industries.

Suggested Citation

  • Onno Kuik & Frédéric Branger & Philippe Quirion, 2018. "Competitive Advantage in the Renewable Energy Industry: Evidence from a Gravity Model," Policy Papers 2018.07, FAERE - French Association of Environmental and Resource Economists.
  • Handle: RePEc:fae:ppaper:2018.07
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    Cited by:

    1. Zacharoula Andreopoulou & Christiana Koliouska, 2018. "Benchmarking Internet Promotion of Renewable Energy Enterprises: Is Sustainability Present?," Sustainability, MDPI, Open Access Journal, vol. 10(11), pages 1-12, November.
    2. Lacal-Arántegui, Roberto, 2019. "Globalization in the wind energy industry: contribution and economic impact of European companies," Renewable Energy, Elsevier, vol. 134(C), pages 612-628.
    3. Hayder M. Kareem Al-Duhaidahawi & Jing Zhang & Mustafa S. Abdulreza & Sinan Abdullah Harjan & Sayyed Sadaqat Hussain Shah, 2019. "The Role of Financial Inclusion and Competitive Advantage: Evidence from Iraqi Islamic Banks," International Journal of Economics and Financial Issues, Econjournals, vol. 9(3), pages 193-199.
    4. Dincer, Hasan & Yuksel, Serhat, 2019. "Balanced scorecard-based analysis of investment decisions for the renewable energy alternatives: A comparative analysis based on the hybrid fuzzy decision-making approach," Energy, Elsevier, vol. 175(C), pages 1259-1270.
    5. Mohamed, Hassen & Ben Jebli, Mehdi & Ben Youssef, Slim, 2019. "Renewable and fossil energy, terrorism, economic growth, and trade: Evidence from France," Renewable Energy, Elsevier, vol. 139(C), pages 459-467.
    6. George E. Halkos & Apostolos S. Tsirivis, 2019. "Energy Commodities: A Review of Optimal Hedging Strategies," Energies, MDPI, Open Access Journal, vol. 12(20), pages 1-19, October.
    7. repec:mup:actaun:actaun_2019067061643 is not listed on IDEAS

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    Keywords

    Competitive Advantage; Gravity Model; Wind Industry; Solar PV Industry; Green Growth;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • K32 - Law and Economics - - Other Substantive Areas of Law - - - Energy, Environmental, Health, and Safety Law
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources

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