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Does foreign environmental policy influence domestic innovation? Evidence from the wind industry

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  • Antoine Dechezlepr�tre
  • Matthieu Glachant

Abstract

This paper examines the relative influence of domestic and foreign renewable energy policies on innovation activity in wind power using patent data from OECD countries from 1994 to 2005. We distinguish between the impact of demand-pull policies (e.g., guaranteed tariffs, investment and production tax credits), as reflected by wind power capacities installed annually, and technology-push policies (government support to R&D). We show that inventors respond to both domestic and foreign new capacities by increasing their innovation effort. However, the effect on innovation of the marginal wind turbine installed at home is 28 times stronger than that of the foreign marginal wind turbine. Unlike demandpull policies, public R&D expenditures only affect domestic inventors. A simple calculation suggests that the marginal million dollars spent on R&D support generates 0.82 new inventions, whereas the same amount spent on the deployment of wind turbines induces, at best, 0.06 new inventions (0.03 locally and 0.03 abroad).

Suggested Citation

  • Antoine Dechezlepr�tre & Matthieu Glachant, 2011. "Does foreign environmental policy influence domestic innovation? Evidence from the wind industry," GRI Working Papers 44, Grantham Research Institute on Climate Change and the Environment.
  • Handle: RePEc:lsg:lsgwps:wp44
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    References listed on IDEAS

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    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Uwe Cantner & Holger Graf & Johannes Herrmann & Martin Kalthaus, 2014. "Inventor Networks in Renewable Energies: The Influence of the Policy Mix in Germany," Jena Economic Research Papers 2014-034, Friedrich-Schiller-University Jena, revised 28 Jan 2016.
    2. Jamasb, Tooraj & Pollitt, Michael G., 2015. "Why and how to subsidise energy R+D: Lessons from the collapse and recovery of electricity innovation in the UK," Energy Policy, Elsevier, vol. 83(C), pages 197-205.
    3. repec:eee:respol:v:46:y:2017:i:5:p:939-955 is not listed on IDEAS
    4. Lazkano, Itziar & Pham, Linh, 2016. "Do Fossil fuel Taxes Promote Innovation in Renewable Electricity Generation?," Discussion Paper Series in Economics 16/2016, Department of Economics, Norwegian School of Economics.
    5. Antoine Dechezleprêtre & Richard Perkins & Eric Neumayer, 2012. "Regulatory Distance and the Transfer of New Environmentally Sound Technologies: Evidence from the Automobile Sector," Working Papers 2012.33, Fondazione Eni Enrico Mattei.
    6. David Popp, 2015. "Using Scientific Publications to Evaluate Government R&D Spending: The Case of Energy," CESifo Working Paper Series 5442, CESifo Group Munich.
    7. Dutz, Mark A. & Sharma, Siddharth, 2012. "Green growth, technology and innovation," Policy Research Working Paper Series 5932, The World Bank.
    8. repec:eee:ecolec:v:141:y:2017:i:c:p:245-260 is not listed on IDEAS
    9. Rexhäuser, Sascha & Löschel, Andreas, 2014. "Invention in energy technologies: Comparing energy efficiency and renewable energy inventions at the firm level," ZEW Discussion Papers 14-036, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    10. Peters, Michael & Schneider, Malte & Griesshaber, Tobias & Hoffmann, Volker H., 2012. "The impact of technology-push and demand-pull policies on technical change – Does the locus of policies matter?," Research Policy, Elsevier, pages 1296-1308.
    11. van den Bijgaart, Inge, 2017. "The unilateral implementation of a sustainable growth path with directed technical change," European Economic Review, Elsevier, vol. 91(C), pages 305-327.
    12. Cantner, Uwe & Graf, Holger & Herrmann, Johannes & Kalthaus, Martin, 2016. "Inventor networks in renewable energies: The influence of the policy mix in Germany," Research Policy, Elsevier, pages 1165-1184.
    13. Huenteler, Joern & Schmidt, Tobias S. & Ossenbrink, Jan & Hoffmann, Volker H., 2016. "Technology life-cycles in the energy sector — Technological characteristics and the role of deployment for innovation," Technological Forecasting and Social Change, Elsevier, vol. 104(C), pages 102-121.
    14. Costantini, Valeria & Crespi, Francesco & Palma, Alessandro, 2017. "Characterizing the policy mix and its impact on eco-innovation: A patent analysis of energy-efficient technologies," Research Policy, Elsevier, pages 799-819.
    15. Rexhäuser, Sascha & Löschel, Andreas, 2015. "Invention in energy technologies: Comparing energy efficiency and renewable energy inventions at the firm level," Energy Policy, Elsevier, vol. 83(C), pages 206-217.
    16. 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.
    17. Guillaume Bourgeois & Sandrine Mathy & Philippe Menanteau, 2017. "The effect of climate policies on renewable energies : a review of econometric studies
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    18. Aalbers, Rob & Shestalova, Victoria & Kocsis, Viktória, 2013. "Innovation policy for directing technical change in the power sector," Energy Policy, Elsevier, pages 1240-1250.
    19. repec:eee:respol:v:46:y:2017:i:9:p:1580-1594 is not listed on IDEAS
    20. Lazkano, Itziar & Nøstbakken, Linda & Pelli, Martino, 2017. "From fossil fuels to renewables: The role of electricity storage," European Economic Review, Elsevier, pages 113-129.
    21. Fergus Green, 2015. "Nationally Self-Interested Climate Change Mitigation: A Unified Conceptual Framework," GRI Working Papers 199, Grantham Research Institute on Climate Change and the Environment.
    22. van den Bijgaart, Inge, 2016. "Essays in environmental economics and policy," Other publications TiSEM 298bee2a-cb08-4173-9fe1-8, Tilburg University, School of Economics and Management.
    23. Valeria Costantini & Francesco Crespi & Alessandro Palma, 2015. "Characterizing the policy mix and its impact on eco-innovation in energy-efficient technologies," SEEDS Working Papers 1115, SEEDS, Sustainability Environmental Economics and Dynamics Studies, revised Jun 2015.

    More about this item

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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