Public Support for the Financing of RD&D Activities in New Clean Energy Technologies

Luis Olmos, Sophia Ruester (), Siok Jen Liong and Jean-Michel Glachant ()

No 2010/69, RSCAS Working Papers from European University Institute

Abstract: Several market failures, as well as other technical, economic and regulatory barriers to the market penetration of clean energy technologies result in under-investment of private innovators in RD&D. Therefore, public support is needed in order to induce innovations. Policy tools creating market conditions that are attractive for the exploitation of clean technologies (market pull) must be combined with other tools directly supporting the development of these technologies through the provision of public funds (technology push). Thereby, financing policy instruments should be chosen so that their characteristics match with those of the specific innovation process being targeted at the same time that social welfare is maximized. We develop an analytical framework to define the form of public support and to provide recommendations on the optimal choice of both technology push and market pull instruments.

Keywords: clean energy technologies; innovation finance; public support; technology push; market pull (search for similar items in EconPapers)
Date: 2010-09-17
New Economics Papers: this item is included in nep-ene and nep-ino
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Citations: View citations in EconPapers (4)

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