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Does foreign environmental policy influence domestic innovation?: evidence from the wind industry

Dechezlepretre, Antoine and Glachant, Matthieu (2014) Does foreign environmental policy influence domestic innovation?: evidence from the wind industry. Environmental and Resource Economics, 58 (3). pp. 391-413. ISSN 0924-6460

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Identification Number: 10.1007/s10640-013-9705-4

Abstract

This paper analyses the relative influence of domestic and foreign demand-pull policies in wind power across OECD countries on the rate of innovation in this technology. We use annual wind power generation to capture the stringency of the portfolio of demand-pull policies in place (e.g., guaranteed tariffs, investment and production tax credits), and patent data as an indicator of innovation activity. We find that wind technology improvements respond positively to policies both home and abroad, but the marginal effect of domestic policies is 12 times greater. The influence of foreign polices is reduced by barriers to technology diffusion, in particular lax intellectual property rights. Reducing such barriers therefore constitutes a powerful policy leverage for boosting environmental innovation globally.

Item Type: Article
Official URL: http://link.springer.com/
Additional Information: © 2014 Springer Science & Business Media Dordrecht
Divisions: Grantham Research Institute
Centre for Economic Performance
Subjects: G Geography. Anthropology. Recreation > GE Environmental Sciences
H Social Sciences > HC Economic History and Conditions
JEL classification: O - Economic Development, Technological Change, and Growth > O3 - Technological Change; Research and Development > O31 - Innovation and Invention: Processes and Incentives
O - Economic Development, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O42 - Monetary Growth Models
Sets: Research centres and groups > Grantham Research Institute on Climate Change and the Environment
Collections > Economists Online
Research centres and groups > Centre for Economic Performance (CEP)
Date Deposited: 24 Jul 2014 14:04
Last Modified: 20 Jun 2019 01:57
Funders: French Council for Energy (CFE)
URI: http://eprints.lse.ac.uk/id/eprint/58155

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