Renewables and Innovation - Empirical Assessment and Theoretical Considerations

Leo Wangler ()
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Leo Wangler: University of Jena, School of Economics and Business Administration

No 2010-002, Jena Economics Research Papers from Friedrich-Schiller-University Jena

Abstract: This study is about structural change in the energy system. In a first step an econometric model is presented and in a second step diffusion of GTs is embedded theoretically. By focusing on different green technology industries (GT sector) in Germany, we analyze how policy induced demand stimulates innovation. Taking the size of the market as a proxy for demand and patent counts as a proxy for innovation, we find support that the presence of institutions enabling diffusion of GTs are correlated with innovative activity. Public R&D expenditures also play a significant role. We additionally control for a structural break by comparing the two institutional settings incorporated into the legal system in Germany, namely the Stromeinspeisegesetz (SEG) and the Erneuerbare Energiengesetz (EEG). We cannot find support for the supposition that innovative activity significantly differs for diffusion under the SEG and EEG. The empirical findings also show that electricity prices are not the driving force for innovative activity within the GT sector. The discussion at the end of the paper comes to the result that diffusion of GTs - under the EEG - is difficult to be justified theoretically.

Keywords: Renewable Energies; Demand Pull; Structural Change (search for similar items in EconPapers)
JEL-codes: L52 O31 O32 Q01 Q5 (search for similar items in EconPapers)
Date: 2010-01-15
New Economics Papers: this item is included in nep-ene, nep-ino and nep-knm
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