## The Impact of Environmental Policy on Innovation in Clean Technologies

_IMF Working Papers, August 6, 2021_

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## Bibliographic details
- Authors: Johannes Eugster
- Published: August 6, 2021
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781513589930.001

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### Summary findings
- The paper studies the effect of climate change mitigating policies on innovation in clean energy technologies.
- Results suggest that the tightening of environmental policies since the early 1990s have made a statistically and economically significant contribution to the increase in clean innovation.
- These effects generally materialized quickly, within 2 to 3 years of the policy change.
- Effects were driven by individually significant marginal effects of both market-based policies (such as feed-in tariffs and trading schemes) and non-market policies (such as R&D subsidies or emission limits).
- Looking at electricity innovation in particular, the estimated effect on total innovation is positive on net, meaning that increased innovation in clean and grey technologies is not offset by a decrease in innovation in dirty technologies.

### Policy implications and recommendations
- The paper’s results call for strong policy efforts to decisively shift innovation towards clean technologies.
- Both market-based policy tools (e.g., feed-in tariffs, trading schemes) and non-market policy tools (e.g., R&D subsidies, emission limits) have individually significant marginal effects and thus can be part of an effective policy mix.

### Study scope and metadata
- Author: Johannes Eugster
- Date: August 6, 2021
- Series: IMF Working Papers
- Working Paper No.: 2021/213
- Issue: 213
- Volume: 2021
- Pages: 32
- DOI: https://doi.org/10.5089/9781513589930.001
- ISBN: 9781513589930
- ISSN: 1018-5941
- Subject areas: Climate policy, Commodities, Electricity, Environment, Environmental policy, Renewable energy, Technology
- Keywords: climate change mitigation, Climate change mitigation, Climate policy, effect of climate change, Electricity, environmental policies, Environmental policy, Global, innovation, policy effort, policy point of view, policy tool, Renewable energy

*Source: The Impact of Environmental Policy on Innovation in Clean Technologies, Johannes Eugster, August 6, 2021, IMF Working Papers No. 2021/213.*

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_Source: https://www.imf.org/en/publications/wp/issues/2021/08/06/the-impact-of-environmental-policy-on-innovation-in-clean-technologies-463352_