Environmental Preferences and Technological Choices: Is Market Competition Clean or Dirty?

Philippe Aghion, Roland Bénabou, Ralf Martin and Alexandra Roulet
Additional contact information
Philippe Aghion: Collège de France
Roland Bénabou: Princeton University
Alexandra Roulet: INSEAD

Working Papers from Princeton University. Economics Department.

Abstract: We investigate the effects of consumers' environmental concerns and market competition on firms' decisions to innovate in "clean" technologies. Agents care about their consumption and environmental footprint; firms pursue greener products to soften price competition. Acting as complements, these forces determine R&D, pollution, and welfare. We test the theory using panel data on patents by 8,562 automobile-sector firms in 41 countries, environmental willingness-to pay, and competition. As predicted, exposure to prosocial attitudes fosters clean innovation, all the more so where competition is strong. Plausible increases in both together can spur it as much as a large fuel-price increase.

Keywords: climate change; Competition; Environment; Innovation; Patents; Social Responsibility (search for similar items in EconPapers)
JEL-codes: D21 D22 D62 D64 H23 O30 O31 (search for similar items in EconPapers)
Date: 2021-01
New Economics Papers: this item is included in nep-ban, nep-com, nep-cse, nep-ene, nep-env, nep-ino, nep-reg, nep-res and nep-sbm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://scholar.princeton.edu/sites/default/files/ ... inal_final_final.pdf

Related works:
Journal Article: Environmental Preferences and Technological Choices: Is Market Competition Clean or Dirty? (2023)
Working Paper: Environmental Preferences and Technological Choices: Is Market Competition Clean or Dirty? (2023)
Working Paper: Environmental Preferences and Technological Choices: Is Market Competition Clean or Dirty? (2023)
Working Paper: Environmental preferences and technological choices: is market competition clean or dirty? (2020)
Working Paper: Environmental Preferences and Technological Choices: Is Market Competition Clean or Dirty? (2020)
Working Paper: Environmental preferences and technological choices: is market competition clean or dirty? (2020)
Working Paper: Environmental Preferences and Technological Choices: Is Market Competition Clean or Dirty? (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pri:econom:2021-64

Access Statistics for this paper

More papers in Working Papers from Princeton University. Economics Department. Contact information at EDIRC.
Bibliographic data for series maintained by Bobray Bordelon ().