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Revisiting the porter hypothesis: An empirical analysis of green innovation for the Netherlands

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  • Leeuwen, George van

    () (Centraal Bureau voor Statistiek)

  • Mohnen, Pierre

    () (UNU-MERIT/MGSoG)

Abstract

Almost all empirical research that has attempted to assess the validity of the Porter hypothesis has started from reduced-form models, e.g. by using single-equation models for estimating the contribution of environmental regulation (ER) to productivity. This paper addresses the Porter Hypothesis within a structural approach that allows us to test what is known in the literature as the "weak" and the "strong" version of the Porter hypothesis. Our "Green Innovation" model includes three types of eco investments and non-eco R&D to explain differences in the incidence of innovation. Besides product and process innovations we recognize eco-innovation as a separate type of innovation output. We explicitly model the potential synergies of introducing the three types of innovations simultaneously and their synergy in affecting total factor productivity (TFP) performance. Using a comprehensive panel of firm-level data built from four surveys we aim to estimate the relative importance of energy price incentives as a market based type of ER and the direct effect of environmental regulation on eco investment and firms' decisions regarding the introduction of several types of innovations. The results of our analysis show a strong corroboration of the weak version of the Porter hypothesis but not of the strong version of the PH, in this case on TFP performance.

Suggested Citation

  • Leeuwen, George van & Mohnen, Pierre, 2013. "Revisiting the porter hypothesis: An empirical analysis of green innovation for the Netherlands," MERIT Working Papers 002, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
  • Handle: RePEc:unm:unumer:2013002
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    References listed on IDEAS

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    Cited by:

    1. Rubashkina, Yana & Galeotti, Marzio & Verdolini, Elena, 2015. "Environmental regulation and competitiveness: Empirical evidence on the Porter Hypothesis from European manufacturing sectors," Energy Policy, Elsevier, vol. 83(C), pages 288-300.
    2. Spyros Arvanitis & Michael Peneder & Christian Rammer & Tobias Stucki & Martin Wörter, 2016. "Competitiveness and ecological impacts of green energy technologies: firm-level evidence for the DACH region," KOF Working papers 16-420, KOF Swiss Economic Institute, ETH Zurich.
    3. Davide Antonioli & Simone Borghesi & Massimiliano Mazzanti, 2014. "Are regional systems greening the economy? The role of environmental innovations and agglomeration forces," SEEDS Working Papers 0414, SEEDS, Sustainability Environmental Economics and Dynamics Studies, revised Feb 2014.
    4. Marius Ley, Tobias Stucki, and Martin Woerter, 2016. "The Impact of Energy Prices on Green Innovation," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1).
    5. Spyros Arvanitis & Michael Peneder & Christian Rammer & Tobias Stucki & Martin Wörter, 2016. "Development and Utilization of Energy-related Technologies, Economic Performance and the Role of Policy Instruments," KOF Working papers 16-419, KOF Swiss Economic Institute, ETH Zurich.
    6. repec:wfo:wstudy:47502 is not listed on IDEAS
    7. Giovanni Marin & Francesca Lotti, 2017. "Productivity effects of eco-innovations using data on eco-patents," Industrial and Corporate Change, Oxford University Press, vol. 26(1), pages 125-148.
    8. Gilli, Marianna & Mancinelli, Susanna & Mazzanti, Massimiliano, 2014. "Innovation complementarity and environmental productivity effects: Reality or delusion? Evidence from the EU," Ecological Economics, Elsevier, vol. 103(C), pages 56-67.
    9. Kunapatarawong, Rasi & Martínez-Ros, Ester, 2016. "Towards green growth: How does green innovation affect employment?," Research Policy, Elsevier, vol. 45(6), pages 1218-1232.
    10. repec:wfo:wstudy:47155 is not listed on IDEAS
    11. Amable, Bruno & Ledezma, Ivan & Robin, Stéphane, 2016. "Product market regulation, innovation, and productivity," Research Policy, Elsevier, vol. 45(10), pages 2087-2104.
    12. Lööf, Hans & Andreas, Andreas & Wulandari, Febi, 2018. "New ventures in Cleantech: opportunities, capabilities and innovation outcomes," Working Paper Series in Economics and Institutions of Innovation 467, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
    13. repec:nbr:nberch:13894 is not listed on IDEAS
    14. Georg Licht & Bettina Peters & Christian Köhler & Franz Schwiebacher, 2014. "The Potential Contribution of Innovation Systems to Socio-Ecological Transition," WWWforEurope Deliverables series 4, WWWforEurope.
    15. Antonietti, Roberto & Marzucchi, Alberto, 2014. "Green tangible investment strategies and export performance: A firm-level investigation," Ecological Economics, Elsevier, vol. 108(C), pages 150-161.
    16. Horbach, Jens, 2016. "The impact of resource efficiency measures on performance in small and medium-sized enterprises," Ruhr Economic Papers 643, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.

    More about this item

    Keywords

    Porter Hypothesis; green innovation; environmental regulation; innovation complementarities; productivity;

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • L5 - Industrial Organization - - Regulation and Industrial Policy
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation

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