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Does green public procurement trigger environmental innovations?

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  • Krieger, Bastian
  • Zipperer, Vera

Abstract

Green public procurement has gained high political priority and is argued to be an effective demand-side policy to trigger environmental innovations. However, the empirical evidence on its innovation impact is limited. We construct a novel firm-level dataset to investigate the effect of winning public procurement tenders with additional environmental award criteria on firms’ introduction of environmental innovations. Employing cross-sectional difference-in-differences methods, we find that winning public procurement awards with environmental selection criteria increases a firm's probability of introducing more environmentally friendly products on average by 20 percentage points. We show that this effect is driven by small and medium-sized firms and is not statistically significant for larger firms. Furthremore, there is no statistically significant effect on the introduction of more environmentally friendly processes.

Suggested Citation

  • Krieger, Bastian & Zipperer, Vera, 2022. "Does green public procurement trigger environmental innovations?," Research Policy, Elsevier, vol. 51(6).
    • Handle: RePEc:eee:respol:v:51:y:2022:i:6:s0048733322000440
    DOI: 10.1016/j.respol.2022.104516
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    Cited by:

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    4. Dorothea Schäfer & Andreas Stephan & Sören Fuhrmeister, 2022. "The Impact of Public Procurement on Financial Barriers to Green Innovation: Evidence from European Community Innovation Survey," Discussion Papers of DIW Berlin 2014, DIW Berlin, German Institute for Economic Research.
    5. Rodríguez-Rebés, Laura & Ibar-Alonso, Raquel & Gómez, Luis Manuel Ruíz & Navío-Marco, Julio, 2024. "The use and drivers of organisational eco-innovation in European SMEs," Research in International Business and Finance, Elsevier, vol. 70(PA).
    6. Donis, Silvia & Gómez, Jaime & Salazar, Idana, 2023. "Economic complexity, property rights and the judicial system as drivers of eco-innovations: An analysis of OECD countries," Technovation, Elsevier, vol. 128(C).
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    12. Liao, Zhongju & Xu, Lijun & Zhang, Mengnan, 2024. "Government green procurement, technology mergers and acquisitions, and semiconductor firms’ environmental innovation: The moderating effect of executive compensation incentives," International Journal of Production Economics, Elsevier, vol. 273(C).
    13. Sebastian Ohlig & Linus Schmidt & Chiara Lichter & Moritz Harting & Lena Herrmann & Bastian Krieger, 2022. "Umweltfreundliche Öffentliche Beschaffung fördern mit People-Public-Private-Partnerships [Promoting Green Public Procurement with People-Public-Private-Partnerships]," Wirtschaftsdienst, Springer;ZBW - Leibniz Information Centre for Economics, vol. 102(12), pages 971-975, December.
    14. Xu, Yong & Yuan, Ling & Khalfaoui, Rabeh & Radulescu, Magdalena & Mallek, Sabrine & Zhao, Xin, 2023. "Making technological innovation greener: Does firm digital transformation work?," Technological Forecasting and Social Change, Elsevier, vol. 197(C).
    15. Albitar, Khaldoon & Al-Shaer, Habiba & Liu, Yang Stephanie, 2023. "Corporate commitment to climate change: The effect of eco-innovation and climate governance," Research Policy, Elsevier, vol. 52(2).
    16. Wen Chen & Yinzi Fan, 2024. "How Do Chinese Exporting Firms Respond to Environment‐related Notifications? A Green Innovation Perspective," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 32(5), pages 1-27, September.
    17. Chiappinelli, Olga & Giuffrida, Leonardo M. & Spagnolo, Giancarlo, 2023. "Public procurement as an innovation policy: Where do we stand?," ZEW Discussion Papers 23-002, ZEW - Leibniz Centre for European Economic Research.
    18. Ren, Xiaohang & Zeng, Gudian & Sun, Xianming, 2023. "The peer effect of digital transformation and corporate environmental performance: Empirical evidence from listed companies in China," Economic Modelling, Elsevier, vol. 128(C).
    19. Liu, Ting & Quan, Lei & Gao, Xing, 2023. "Social dishonesty and corporate green innovation," Economic Analysis and Policy, Elsevier, vol. 79(C), pages 967-985.
    20. Zhen Yang & Dongwei Su & Shulin Xu & Xu Han, 2024. "Institutional investors and corporate green innovation: Evidence from China," Pacific Economic Review, Wiley Blackwell, vol. 29(2), pages 230-266, May.
    21. Wei, Xiahai & Wei, Qingfang & Yang, Lisha, 2023. "Induced green innovation of suppliers: The “green power” from major customers," Energy Economics, Elsevier, vol. 124(C).
    22. Maria Siddiqui & Ayman Taj & Saira Jessani & Asadullah Lakho, 2024. "The Effects of Green Procurement, Green Production, and Green Logistics in the Overall Performance of Green Supply Chain Management," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 13(3), pages 67-78.
    23. Chunling Yu & Toru Morotomi & Qunwei Wang, 2023. "Heterogeneous Effects of Public Procurement on Environmental Innovation, Evidence from European Companies," Sustainability, MDPI, vol. 15(19), pages 1-23, September.

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    More about this item

    Keywords

    Green public procurement; Environmental innovation; Demand pull;
    All these keywords.

    JEL classification:

    • H57 - Public Economics - - National Government Expenditures and Related Policies - - - Procurement
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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