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Nicoletta Corrocher (Università Bocconi)

29 May 2013 @ 16:30

 

  • Past event

“Innovation and stringency of environmental regulation in waste management: a patent-based analysis”

abstract

This work aims at empirically testing the (narrow version of the) Porter hypothesis, by analyzing the relationshipbetween stringency of environmental regulation and innovation in a cross-country setting (EU countries) with reference to waste management, which is an increasingly important issue in the EU environmental policy agenda. To address thisquestion, patent applications from the waste management category of the WIPO Green Inventory between 1995 and 2006 are used as a measure of innovation in waste management. As a measure of environmental stringency instead, we look at the yearly flows of waste recycling, following previous empirical works (Chimeli et al., 1999; Xing and Kolstad, 2002). Furthermore, we introduce some controls that account for country-specific characteristics in terms of innovative activity and environmental behavior – GDP per capita, population, R&D/GDP, green patents/total patents, air emissions level. We employ negative binomial regressions with random effects. To control for potential endogeneity, we introduce independent variables with different time lags. Preliminary results show that the flow of waste recycling has a positive effect on innovation in waste management, confirming the narrow version of the Porter hypothesis – i.e. stringency of regulation has a positive effect on innovation. Therefore, we do find support to increasingly strict legislative regimes and evidence against the traditional idea that rigidity in environmentally related lawmaking is detrimental to innovation. GDP, population and R&D/GDP have the expected positive impact on the number of patents in waste management, while the control variable for environmental behavior (air emission) negatively impact on innovation.