Due to maintenance work, the content of ssb.no may be unstable between 4pm and 6pm today. We apologise for any inconvenience this may cause.

Discussion Papers no. 754

Study on firm level patenting

Can non-market regulations spur innovations in environmental technologies?

This paper provides new evidence on the role of non-market based (“command-and-control”) regulations in relation to innovations in environmental technologies.

This paper provides new evidence on the role of non-market based (“command-and-control”) regulations in relation to innovations in environmental technologies. While pricing is generally considered the first-best policy instrument, non-market regulations, such as technology standards and non-tradable emission quotas, are common when a regulator faces multiple emission types and targets, heterogeneous recipients, or uncertainty with regard to marginal damages. Knowing whether these regulations spur or hinder innovation is of great importance to environmental policy. Using a unique Norwegian panel data set that includes information about the type and number of patent applications, technology standards, non-tradable emission quotas, and a large number of control variables for almost all large and medium-sized Norwegian incorporated firms, we are able to conduct a comprehensive study of the effect of non-market based regulations on environmental patenting. Unlike previous studies that are typically conducted at the industry level, we are able to take firm heterogeneiry into account, and thereby reduce the common problem of omitted variable bias in our analysis. We empirically identify strong and significant effects on innovations from implicit regulatory costs associated with the threat that a firm will be sanctioned for violating an emission permit.

About the publication

Title

Can non-market regulations spur innovations in environmental technologies?. Study on firm level patenting

Authors

Marit E. Klemetsen, Brita Bye, Arvid Raknerud

Series and number

Discussion Papers no. 754

Publisher

Statistics Norway

Topic

Discussion Papers

ISSN

1892-753X

Number of pages

30

Language

English

About Discussion Papers

Discussion papers comprise research papers intended for international journals and books. A preprint of a Discussion Paper may be longer and more elaborate than a standard journal article as it may include intermediate calculations, background material etc.

Contact