Environmental compliance costs and innovation activity in UK manufacturing industries
We examine the relationship between environmental regulations and innovation, using data from UK manufacturing industry during 2000-2006. We estimate a dynamic model of innovation behaviour, and explicitly account for the likely endogeneity of our measure of the burden of environmental regulations (pollution abatement costs). Our results indicate that environmental R&D and investment in environmental capital are stimulated by greater pollution abatement pressures. However, we do not ?find a positive impact of environmental compliance costs on total R&D or total capital accumulation. New environmental innovations may therefore have a crowding out effect on other potentially more productive investments or avenues for innovation.
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- Isabelle Piot-Lepetit & Monique Moing, 2007. "Productivity and environmental regulation: the effect of the nitrates directive in the French pig sector," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 38(4), pages 433-446, December.
- Alonso-Borrego, Cesar & Arellano, Manuel, 1999.
"Symmetrically Normalized Instrumental-Variable Estimation Using Panel Data,"
Journal of Business & Economic Statistics,
American Statistical Association, vol. 17(1), pages 36-49, January.
- Alonso-Borrego, César & Arrellano, Manuel, 1996. "Symmetrically normalized instrumental-variable estimation using panel data," UC3M Working papers. Economics 4098, Universidad Carlos III de Madrid. Departamento de Economía.
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