Environmental policy and R&D productivity: A case study from the Korean Emissions Trading Scheme

Jung Youn

Science and Public Policy, 2023, vol. 50, issue 1, 120-128

Abstract: This study investigates the relationship between emissions trading schemes and Research and Development (R&D) productivity based on data from manufacturing industries participating in the Korean Emissions Trading Scheme (KETS). First, this study estimates the total factor R&D productivity by industry, and it is confirmed that changes in R&D productivity vary across industries. The total factor R&D productivity in Korea has been decreasing, but the annual growth trend has been increasing rapidly due to the introduction of the KETS. Based on the estimated R&D productivity, panel data model estimation is executed to reveal the effect of environmental policy on R&D productivity. Empirical results confirm that environmental policy plays a vital role in promoting R&D productivity, and policy stringency affects R&D performance. The results also find that the environmental policy encourages enterprises to participate in KETS for improving R&D productivity.

Keywords: R&D productivity; emissions trading schemes; environmental policy; carbon emissions; manufacturing industries (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:oup:scippl:v:50:y:2023:i:1:p:120-128.

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