R&D, Patenting and Market Regulation: Evidence from EU Electricity industry

Carlo Cambini, Federico Caviggioli and Giuseppe Scellato

No 78, IEFE Working Papers from IEFE, Center for Research on Energy and Environmental Economics and Policy, Universita' Bocconi, Milano, Italy

Abstract: In this paper we study the effects of the changes in the level of product market regulation on the industry-level innovation intensity in the Electricity sector across 16 European countries during years 1990-2009. We matched data on R&D budgets and EPO patent applications from IEA and Eurostat Databases and indexes of market regulation conditions from OECD, in order to test the impact of deregulatory policies on the propensity to innovate in new energy technologies. Our findings indicate an increase in the aggregated Electricity R&D and in patenting activities following market deregulation. Our measure of market regulation intensity is based on the aggregation of three factors that capture respectively entry barriers, public ownership and vertical integration. Econometric results suggest that policies aimed at a reduction in vertical integration have a positive impact on both industry-level R&D and patenting. The reduction of public ownership of incumbent operators and entry barriers are mostly associated to a significant increase in R&D expenditures. In the paper we discuss the implication of this evidence in light of the current trend in investment in the electricity sector in Europe.

Keywords: Innovation; Patents; Regulation; Electricity. (search for similar items in EconPapers)
JEL-codes: L94 O31 O32 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2015
New Economics Papers: this item is included in nep-com, nep-cse, nep-ene, nep-eur, nep-ind, nep-ino, nep-ipr, nep-pr~ and nep-reg
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Citations: View citations in EconPapers (1)

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