Specialisation, Diversification and the Ladder of Green Technology Development

Abstract

This paper elaborates an empirical analysis of the temporal and geographical distribution of green technology, and on how specific country characteristics enable or thwart environmental inventive activities. Using patent data on 63 countries over the period 1970-2012 we identify key drivers of cross-country diversification and specialization. Our first finding is that countries diversify towards green technologies that are related to their existing competences. Notably, the maturity of the green technology matters more than the level of development of each country. The second main result is that countries move along cumulative paths of specialization, and towards more complex green technologies. Interestingly, the complexity of green technologies is not an obstacle to further specialisation. The latter holds also for developing countries that are most exposed to climate change hazards.

Keywords: Environmental Technology; Technological diversification; Technological specialisation

JEL Classification: O14; O33; Q55