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Do federal regulations beget innovation? Legislative policy and the role of executive orders

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  • Smirnova, Olga
  • Strumsky, Deborah
  • Qualls, Ashley C.

Abstract

Our research note focuses on whether policy changes in the transportation sector contribute to green innovations, measured as patents. We explore federal policies, specifically energy policies such as Energy Policy Act of 1992 or 2005, that provide incentives for the development of environmentally friendly technologies in transportation. Drawing on a combination of qualitative and quantitative data, we construct and test several novel policy measures while controlling for other factors that may influence green transportation innovations. We develop a unique legislative timeline with the use of key-informant interviews, literature searches, and legislative updates reviews. Only one policy variable (executive orders) appears to have a positive effect on the number of patents in green transportation innovation sphere. High capital expenditures for pollution abatement decrease innovation activity, while high operating expenditures increase innovation activity. The federal policies over the time period analyzed seem to create uncertainty rather than provide a clear incentive for innovation. The executive orders may affect innovation levels; further tests are needed with the changes in political leadership. The results of our research note signal that stronger and more consistent incentives at federal level may be necessary to realize desired policy outcomes.

Suggested Citation

  • Smirnova, Olga & Strumsky, Deborah & Qualls, Ashley C., 2021. "Do federal regulations beget innovation? Legislative policy and the role of executive orders," Energy Policy, Elsevier, vol. 158(C).
    • Handle: RePEc:eee:enepol:v:158:y:2021:i:c:s0301421521004407
    DOI: 10.1016/j.enpol.2021.112570
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    2. Weizhou Su & Gaowen Lei & Sidai Guo & Hongche Dan, 2022. "Study on the Influence Mechanism of Environmental Management System Certification on Enterprise Green Innovation," IJERPH, MDPI, vol. 19(19), pages 1-20, September.
    3. Jiang, Zihao & Shi, Jiarong, 2023. "Government intervention and technological innovation in the wind power industry in China: The role of industrial environmental turbulence," Applied Energy, Elsevier, vol. 344(C).
    4. Xin Nie & Jianxian Wu & Han Wang & Lihua Li & Chengdao Huang & Weijuan Li & Zhuxia Wei, 2022. "Booster or Stumbling Block? The Role of Environmental Regulation in the Coupling Path of Regional Innovation under the Porter Hypothesis," Sustainability, MDPI, vol. 14(5), pages 1-20, March.

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