Resource Efficiency, Environmental Policy and Eco-Innovations for a Circular Economy: Evidence from EU Firms

Giulio Cainelli (), Alessio D’Amato and Massimiliano Mazzanti
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Giulio Cainelli: University of Padova & SEEDS
Alessio D’Amato: University of Tor Vergata Rome & SEEDS
Authors registered in the RePEc Author Service: Alessio D'Amato ()

SPRU Working Paper Series from SPRU - Science Policy Research Unit, University of Sussex Business School

Abstract: Innovation adoption and diffusion by firms are key pillars for the EU strategy on resource-efficiency and the development of a circular economy. This paper presents new EU evidence regarding the role of environmental policy and green demand drivers to sustain the adoption of resource efficiency-oriented eco-innovations. This paper originally implements new estimators to address the endogeneity of binary framed policy and demand covariates, which typically characterise firm level survey data. Our results suggest that when endogeneity is accounted for, environmental policy is the only factor always significant in driving the adoption of innovations that reduce the use of waste and material, while demand-side and market-factors do not always play a central role. The result is an important piece of new quantitative-based knowledge, which complements the currently large case study-based evidence on the setting of sound management and policy strategies for the circular economy.

Keywords: Eco innovation; circular economy; innovation drivers; EU; environmental regulation; market demand (search for similar items in EconPapers)
Date: 2017-11
New Economics Papers: this item is included in nep-agr, nep-cse, nep-ene, nep-env, nep-eur, nep-ino and nep-res
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Persistent link: https://EconPapers.repec.org/RePEc:sru:ssewps:2017-24

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