The Impact of Environmentally Friendly Innovations on Value Added

Abstract

While recent literature has focused on explaining the determinants of green innovations, it is not well understood how such innovations affect performance. To analyse the relationship between green innovation and performance, new industry-level panel data were exploited: these include 12 OECD countries, the whole manufacturing sector and a period of 30 years. The results show that green inventions are U-shape related to performance. However, the turning point is quite high and hence only relevant for a few industries. This indicates that-given the current level of green promotion-market incentives alone are not sufficient to allow the green invention activities of industries to rise considerably. To verify these results and to get a better understanding of the mechanisms in the green market, we finally made several interviews with multinational firms that have a good understanding of what happens on the global market of green innovation.

Eco-Efficiency Actions and Firm Growth in European SMEs

“…In specification V, however, when we also incorporate the quadratic term, the breadth variable becomes negative and significant, and the quadratic term positive and significant, which suggests that the wider array of eco-strategies influences firm performance more than proportionality. The relationship between firm growth and the number of eco-strategies carried out by firms is U-shaped, in line with the findings of Soltmann et al [29] using industry-level data. This implies that when the number of eco-strategies undertaken is low, this has a negative impact on firm performance.…”

“…Using industry-level data from 12 OECD countries, Soltmann et al [29] shows that the general relationship between the intensity of green inventions and performance is U-shaped. They concluded that the turning point is quite high and consequently only relevant for a few industries.…”

Introducing Sustainability in Value Models to Support Design Decision Making: A Systematic Review

“…It can also be observed that consumers are more willing to pay such a premium for commodities rather than for more complex systems. The latter is explained by observing that an increasing level of green inventions is found to negatively affect performances of the system [38], following U-shaped relationship. Several studies [39,40] further show that the decision of buying green and paying a premium price is mainly influenced by social and cultural norms, and that individuals are more sensitive towards social sustainability aspects that towards environmental sustainability [41].…”

Technological and organizational capital: Where complementarities exist

“…In addition to the extended model results above, we examine the robustness of our main findings with a number of alternative specifications and sensitivity checks, which are typically encountered in comparable settings: Specifically, we assess the impact of allowing time‐varying organizational variables (in Section ; cf., e.g., Arvanitis et al, ), separate inclusion of interaction terms (in Section ; cf., e.g., Arvanitis et al, ; Hollenstein & Stucki, ), individual subcomponents of organizational capital components (in Section ; cf., e.g., Stucki & Woerter, ), usage of direct measures for IT (in Section ; cf., e.g., Bloom et al, ), and finally assess differences over time (in Section ; cf., e.g., Soltman et al, ). The following tests are all based on our main model specification provided in Column 3 of Table , which simultaneously includes both computer and intranet use and controls for industry‐time fixed effects as well as firm fixed effects.…”