What are the determinants of investment in environmental R&D?

Maria Costa-Campi, Jose Garcia-Quevedo and Ester Martínez-Ros

Energy Policy, 2017, vol. 104, issue C, 455-465

Abstract: To face the challenges posed by climate change, environmental R&D and innovation are critical factors if we hope to cut emissions; yet, investment in environmental R&D remains below the social optimum. The aim of this paper is to analyse the determinants of investment in environmental innovation and to detect the differences, if any, with the determinants of investment in general innovation. In addition, this paper examines the relationship between environmental innovation R&D expenditure and a range of policy instruments, including environmental regulation and other policy measures including R&D subsidies and environmental taxes. The empirical analysis is carried out for 22 manufacturing sectors in Spain for the period 2008–2013. To overcome problems of data availability, we construct a comprehensive database from different surveys. The main implications from our results are (1). Managerial strategy appears as a relevant driver of environmental R&D investments. (2) The establishment of a policy mix between environmental, energy and technological regulatory measures is recommended. (3) The promotion of self-regulation through actions that encourage companies to follow a policy that affects their energy efficiency and is environmentally friendly.

Keywords: Environmental innovation; Tax and demand instruments; Panel data (search for similar items in EconPapers)
JEL-codes: O30 Q50 Q58 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (42)

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Working Paper: What are the determinants of investment in environmental R&D? (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:104:y:2017:i:c:p:455-465

DOI: 10.1016/j.enpol.2017.01.024

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