Entrepreneurs for a low carbon world: How environmental knowledge and policy shape the creation and financing of green start-ups

Theodor F. Cojoianu, Gordon L. Clark, Andreas G.F. Hoepner, Paolo Veneri and Dariusz Wójcik

Research Policy, 2020, vol. 49, issue 6

Abstract: We investigate how different types of environmental policies and new regional environmental knowledge affect new venture creation in and financing of green (low carbon), brown (fossil fuel) and gray (unrelated to natural resources) technologies across 24 OECD countries and 293 regions over the period 2001-13. We find that new regional environmental knowledge positively impacts new venture creation in green technologies, and moderately in gray industries. Gray industries also benefit from enhanced start-up financing in regions where new environmental knowledge is created, confirming that environmental knowledge creation yields positive externalities beyond the green sector. We also find that a more stringent environmental policy regime negatively impacts the creation of new ventures across sectors, but most prominently, it discourages new fossil fuel ventures. However, once entrepreneurs decide to start a new business, stringent environmental policies have on aggregate a positive effect on new venture financing across sectors, particularly through feed-in-tariffs and emission standards.

Keywords: Environmental entrepreneurship; Environmental policy; Environmental finance; Knowledge spillover; Green venture capital; Fossil fuels (search for similar items in EconPapers)
JEL-codes: O38 Q28 Q31 Q38 Q55 Q58 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (35)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:respol:v:49:y:2020:i:6:s0048733320300688

DOI: 10.1016/j.respol.2020.103988

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