A weak version of the Porter hypothesis claims that strict environmental policy provides positive innovation incentives, hence triggering improved competitiveness and securing environmental quality.In a comparative way, this paper empirically tests this hypothesis across countries by linking environmental stringency to innovation proxied by patents in the field of SO2 abatement over the period 1970-2000.Three different models of environmental stringency are examined.Two of these models do not reveal a positive significant effect on innovation as a result of increased stringency.In the theoretically preferred model, however, a positive relationship between environmental stringency and innovation is obtained.
|Place of Publication||Tilburg|
|Number of pages||34|
|Publication status||Published - 2005|
|Name||Discussion Papers / CentER for Economic Research|
- pollution control
- environmental stringency
- sulfur dioxide