Can Direct Regulations Spur Innovations in Environmental Technologies? A Study on Firm‐Level Patenting

34 Pages Posted: 26 Mar 2018

See all articles by Marit E. Klemetsen

Marit E. Klemetsen

CICERO Center for International Climate Research

Brita Bye

Statistics Norway - Research Department

Arvid Raknerud

Statistics Norway - Research Department

Date Written: April 2018

Abstract

Using a rich Norwegian panel dataset that includes information about the type and number of patent applications, direct environmental regulations, and a large number of control variables, we analyze the effects of direct regulations on environmental patenting. We use inspection violation status as a measure of regulatory stringency, while controlling for risk class. Violation status captures the probability that a firm might be sanctioned for violating its emission permit. Controlling for risk class captures firm heterogeneity related to dirtiness and inspection frequency. We empirically identify strong and significant effects on innovations resulting from the implicit regulatory costs of direct regulations.

Keywords: Command‐and‐control regulations, environmental technologies, innovation, patents, Poisson count model

Suggested Citation

Klemetsen, Marit E. and Bye, Brita and Raknerud, Arvid, Can Direct Regulations Spur Innovations in Environmental Technologies? A Study on Firm‐Level Patenting (April 2018). The Scandinavian Journal of Economics, Vol. 120, Issue 2, pp. 338-371, 2018, Available at SSRN: https://ssrn.com/abstract=3149187 or http://dx.doi.org/10.1111/sjoe.12201

Marit E. Klemetsen (Contact Author)

CICERO Center for International Climate Research ( email )

Gaustadalléen 21, 0349 OSLO
OSLO, OSLO 0349
Norway

Brita Bye

Statistics Norway - Research Department ( email )

Kongens Gt. 6
PO Box 8131 Dep
N-0033 Oslo
Norway

Arvid Raknerud

Statistics Norway - Research Department ( email )

P.O. Box 8131 Dep, N-0033
N-0033 Oslo
Norway

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