The Economic Geography of Clean Tech Venture Capital

Oxford University Working Paper Series in Employment, Work and Finance

44 Pages Posted: 14 Apr 2010

See all articles by Eric R. W. Knight

Eric R. W. Knight

University of Sydney Business School

Date Written: April 13, 2010

Abstract

Climate change has emerged as one of the dominant environmental business problems of this century. A key aspect of this challenge is financing and commercializing the technologies which will assist economic transition to a low carbon economy. This paper is focused on examining the levers and barriers to private equity investment in this technological innovation in the United States and United Kingdom specifically. In particular, we focus on the critical role of geography in shaping private investment for a variety of reasons including physical conditions, regulatory influences, access to finance, and social clusters.

In the final section, this paper considers the broader implications of our findings for optimal policy settings to facilitate clean technology innovation. Although carbon markets have been identified as part of the policy mix in assisting structural transition in the global economy, the proper formulation of technology policy has been relatively under-addressed. This paper argues that well-targeted technology policy is needed alongside carbon pricing to help promote technological innovation and remove barriers to private investment.

Keywords: venture capital, clean tech, economic geography, carbon markets, technology policy, private equity

JEL Classification: G18, O18, O31, O33, O39

Suggested Citation

Knight, Eric R. W., The Economic Geography of Clean Tech Venture Capital (April 13, 2010). Oxford University Working Paper Series in Employment, Work and Finance. Available at SSRN: https://ssrn.com/abstract=1588806 or http://dx.doi.org/10.2139/ssrn.1588806

Eric R. W. Knight (Contact Author)

University of Sydney Business School ( email )

Cnr. of Codrington and Rose Streets
Sydney, NSW 2006
Australia

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