Induced Innovation and Energy Prices

By David Popp. 2001

1,648 citations recorded by the source corpus.

I use U.S. patent data from 1970 to 1994 to estimate the effect of energy prices on energy-efficient innovations. Using patent citations to construct a measure of the usefulness of the existing base of scientific knowledge, I consider the effect of both demand-side factors, which spur innovative activity by increasing the value of new innovations, and supply-side factors, such as scientific advancements that make new innovations possible. I find that both energy prices and the quality of existing knowledge have strongly significant positive effects on innovation. Furthermore, I show that omitting the quality of knowledge adversely affects the estimation results.

Subfields: Economics and Econometrics, Management of Technology and Innovation, Management Science and Operations Research

View Paper: https://www.semanticscholar.org/paper/e2699f8984a4253862a7430d5a61ad59db007d4a

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Citations in the corpus

The role of energy in economic growth (2011, neutral): “Popp (2002) similarly finds that increased energy prices have a significant though quantitatively small effect on the rate of patenting in the energy sector.”
Carbon Taxes, Path Dependency, and Directed Technical Change: Evidence from the Auto Industry (2012, positive): “In quantitative terms, how do our estimates compare to others in the literature? Popp (2002) reports short-run energy price elasticities for the impact of prices on the aggregate number clean patents as a share of all patents (we look at long-run price effects in Section 6 below).”
The Role of R&D and Technology Diffusion in Climate Change Mitigation: New Perspectives Using the Witch Model (2009, positive): “New energy R&D is assumed to crowd out 50% of other R&D, as in Popp (2004).”
Environmental Regulation, Green Innovation, and Industrial Green Development: An Empirical Analysis Based on the Spatial Durbin Model (2018, background): “Some scholars put technical progress, environmental quality, and economic growth into a unified analytical framework, and put forward the concept of technological progress bias, energy conservation, and cleaner production—that is, green innovation [27,28].”
Do eco-innovations harm productivity growth through crowding out? Results of an extended CDM model for Italy (2014, background): “Among other, refer to Lanjouw and Mody (1996), Popp (2002), Brunnermeier and Cohen (2003), Wagner (2007) and Johnstone et al (2010).”
Modeling endogenous technological change for climate policy analysis (2008, background): “The empirical evidence suggests that the price-inducement form of TC does have merit as a partial explanation; higher energy prices clearly are associated with faster improvements in energy efficiency (Newell et al., 1999; Popp, 2002).”
Does more stringent environmental regulation induce or reduce technology adoption? When the rate of technology adoption is inverted u-shaped (2012, background): “A monotonic relationship is also commonly assumed in empirical tests of induced innovation/diffusion hypotheses (see e.g. Jaffe and Palmer 1997, Newell 1999, Popp 2002, Kerr and Newell 2003, Brunnermeier and Cohen 2003, Carrión-Flores and Innes 2010).”
Invention and Transfer of Climate Change Mitigation Technologies on a Global Scale: A Study Drawing on Patent Data (2010, neutral): “That innovators respond so quickly to changes in energy prices may be surprising, but this has already been well documented in previous research (e.g., Newell et al., 1999; Popp, 2002).”
The role of patent protection in (clean/green) technology transfer (2010, neutral): “ When combined with findings by Popp (2002) that show a positive elasticity of the share of energy patents in total patents with respect to energy prices, these results suggest that an increase in energy prices induces innovation …”
The Impact of Regulation on Innovation (2016, background): “…Porter and van der Linde (1995), Lanjouw and Mody (1996), Hart und Ahuja (1996) and the more recent studies by Brunnermeier and Cohen (2003), Popp (2002), Popp (2006), Popp et al. (2007), Lanoie et al. (2008), and further studies listed in the survey by Gonzalez (2009) generally find, at…”
Is There Really a Green Paradox? (2012, neutral): “There may be technical progress in renewables (e.g., Bovenberg and Smulders, 1996; Popp, 2002; Bosetti, et al., 2009; Acemoglu et al., 2012; van der Meijden and Smulders, 2012; Daubanes et al., 2012) leading to a gradual decline in the price of renewables, thus bringing forward the date of the…”
Green inventions and greenhouse gas emission dynamics: a close examination of provincial Italian data (2016, background): “Therefore, we need to discount the number of both total and green patents according to the following formula (Popp 2002):”
The causality between energy consumption and economic growth: A multi-sectoral analysis using non-stationary cointegrated panel data (2010, background): “The lower price of energy also results in an income effect that increases demand for all goods in the economy and therefore the energy required to produce them (Lovins, 1988; Newell et al., 1999; Popp, 2002).”