Does legal system matter for directed technical change? Evidence from the auto industry

Per Fredriksson and Alexandre Sauquet

Applied Economics Letters, 2017, vol. 24, issue 15, 1080-1083

Abstract: Does the effect of fuel taxes on clean innovations (e.g. hybrid technology) depend on the legal system’s rigidity? Using 1986–2005 data from more than 1900 firms, evidence suggests that auto-industry firms located in civil law (with more rigid laws) countries increase clean technology patenting more than common law (with more flexible laws) firms when the tax-inclusive fuel price rises. A rigid legal system appears to raise clean technology innovation.

Date: 2017
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DOI: 10.1080/13504851.2016.1254334

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