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Theoretical and Empirical Evidence of Timing-to-Market and Lead Market Strategies for Successful Environmental Innovation

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Abstract

In environmental policy first mover advantages for environmental technologies are often taken for granted. It is a popular view to see the state as a political entrepreneur who introduces a certain environmental policy instrument, e.g. feedin tariffs for renewable energies, and thus becomes the world market leader or the lead market for the respective technology. Against this background, this paper wants to find out if the idea of first mover advantages can be justified by theories and empirical evidence from industrial organization and business management studies. After a review of theoretical and empirical papers we see that first mover advantages are not confirmed by empirical evidence. Thereby the successful innovator is not necessarily the first but very often one of the early movers within the competition of different innovation designs. We show that the success of a timing strategy depends on country-specific lead market potentials, on market and technology characteristics and on the regime of the country-specific regulation. On this basis we derive options for environmental innovation strategies for firms under different circumstances of markets, technologies and regulations. We will see different implications for practical innovation management and innovation policy.

Suggested Citation

  • Thomas Cleff & Klaus Rennings, 2011. "Theoretical and Empirical Evidence of Timing-to-Market and Lead Market Strategies for Successful Environmental Innovation," Discussion Papers dp11-01, Department of Economics, Simon Fraser University.
  • Handle: RePEc:sfu:sfudps:dp11-01
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    Cited by:

    1. Juliana Subtil Lacerda & Jeroen C. J. M. van den Bergh, 2014. "International Diffusion of Renewable Energy Innovations: Lessons from the Lead Markets for Wind Power in China, Germany and USA," Energies, MDPI, Open Access Journal, vol. 7(12), pages 1-28, December.

    More about this item

    Keywords

    Lead markets; environmental innovation; first mover advantages; innovation strategies;

    JEL classification:

    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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