Working Paper: NBER ID: w9978
Authors: David Popp
Abstract: When studying solutions to long-term environmental problems such as climate change, it is important to consider the role that technological change may play. Nonetheless, to date few economic models of climate change explicitly model the link between policy and technological change. There is a growing body of evidence that the incentives offered by prices and environmental regulations have a strong influence on both the creation and adoption of new technologies. In several recent papers, I have used patent data to examine the links between environmental policy and technological change. In addition, I have used the results of this research to calibrate the ENTICE model (for Endogenous Technological change) of climate change, which links energy-related R&D to changes in the price of carbon. Drawing on my experiences from empirical studies on innovation and from modeling the climate change problem, in this paper I review some of the key lessons from recent empirical work using patents to study environmental innovation and diffusion, and discuss its implications for modeling climate change policy. I conclude by offering suggestions for future research.
Keywords: No keywords provided
JEL Codes: Q33; Q30; Q40
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Higher energy prices (Q41) | Increased R&D activity (O39) |
| Environmental regulations (Q52) | Induced innovation in environmentally-friendly technologies (Q55) |
| Economic factors (P42) | Likelihood of technology adoption (O33) |
| Environmental policy (Q58) | Technological innovation (O39) |