Determinants of energy-efficient innovation: Induction mechanisms and stakeholders pressures
37 Pages Posted: 20 Nov 2014 Last revised: 14 Dec 2015
Date Written: October 15, 2014
This paper addresses the determinants of energy-efficient innovation (EEI), a key ingredient of sustainable growth. Induced innovation view is submitted to a demanding empirical test, and simultaneously complemented with the analysis of alternative EEI drivers, which are based on the stakeholder theory. In order to operationalise the analysis, hypotheses are formulated for different EEI types, i.e. product EEI for domestic market, product EEI for international markets, process EEI. The empirical setting is based on the sixth wave of Community Innovation Surveys (CIS-VI), which provides a cross-sectional sample of firms in 9 European countries in 2006-2008 period. The CIS-VI dataset is matched with independent data sources. Sizeable evidence that energy-efficient innovation is primarily a case of induced innovation is found, i.e. firms do respond to market-based incentives. On the contrary, evidence about EEI as a result of firms’ quest for legitimacy with regulatory and social stakeholders is not found.
Keywords: Energy-efficient innovation, Induced innovation, Stakeholders pressures, Energy price, Energy cost share, Public attentiveness, Environmental regulations, Regulation stringency
JEL Classification: Q40, Q41, Q48
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