Do R&D Spillovers Support Emission Abatement Targets?

Natalia Kuosmanen and Timo Kuosmanen

No 175, ETLA Brief from The Research Institute of the Finnish Economy

Abstract: Abstract This brief examines how R&D spillovers are associated with firm-level greenhouse gas emissions in Finnish energy-intensive manufacturing. The results show that R&D spillovers from other firms within the same industry are more strongly associated with lower emissions than the firm’s own R&D activity. This result highlights the role of innovation spillovers and knowledge diffusion in emissions abatement. However, the direction and magnitude of R&D spillovers differ across industries depending on their R&D intensity. In the chemical industry that has high R&D intensity, inter-industry R&D spillovers are associated with lower emissions, whereas in the pulp and paper and basic metals industries, inter-industry R&D spillovers are associated with higher emissions. These results demonstrate that technology spillovers do not automatically lower emissions, but can also contribute to higher emissions. Our findings reveal an important channel of inter-industry R&D spillovers through material flows, highlighting the pivotal role of the chemical industry for the GHG abatement in the pulp and paper production and non-metallic minerals industry.

Keywords: Carbon dioxide emissions; Environmental performance; Green productivity; Sustainability; Technology spillovers (search for similar items in EconPapers)
JEL-codes: D24 O33 Q52 Q55 Q56 (search for similar items in EconPapers)
Pages: 8 pages
Date: 2026-02-23
New Economics Papers: this item is included in nep-cse, nep-eff and nep-sbm
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