Abstract
The research study reported here analyses the link between sustainability-related and similar regulation and environmental and sustainability-related innovation in firms and ultimately the effect on economic performance and competitive advantage. Our study of these effects uses case study data and survey data for German manufacturing firms. Emphasis is placed on the interaction of different kinds of regulations differentiated between standard/limit-based, market-based or voluntary agreements and types of innovation, specifically product versus process innovation. Circumstances such as stringency and range of regulations and their corresponding impact are also considered since their effect on firms’ innovation processes matters in terms of acceleration, framework building or indirect effects. We find that innovations triggered by regulation can improve the environmental performance of the affected product itself and/or related processes and that this leads to innovation offsets which exceed the costs of compliance and enhance competitiveness. Furthermore, setting effects of environmental regulation as well as interactions between markets and first-mover advantages could be identified amongst others as key variables that affect the potential for innovation offsets.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Similar content being viewed by others
References
Armstrong, J. S., & Overton, T. S. (1977). Estimating non-response bias in mail surveys. Journal of Marketing Research, 14, 396–402.
Costantini, V., & Crespi, F. (2008). Environmental regulation and the export dynamics of energy technologies. Ecological Economics, 66, 447–460.
Costantini, V., & Crespi, F. (2010). Public policies for a sustainable energy sector: Regulation, diversity and fostering of innovation. Journal of Evolutionary Economics. doi:10.1007/s00191-010-0211-3.
Costantini, V., & Mazzanti, M. (2012). On the green and innovative side of trade competitiveness? The impact of environmental policies and innovation on EU exports. Research Policy, 41, 132–153.
EIO Eco Innovation Observatory. (2010). Methodological report for the European. Brussels: Europe Innova.
Hall, B. H., & Ham Ziedonis, R. (2001). The patent paradox revisited: An empirical study of patenting in the U.S. semiconductor industry, 1979–1995. The RAND Journal of Economics, 32, 101–128.
Hart, S. (1995). A natural-resource-based view of the firm. Academy of Management Review, 20, 986–1014.
Lanjouw, J., & Mody, A. (1996). Innovation and the international diffusion of environmentally responsible technologies. Research Policy, 25, 549–571.
Mazzanti, M., & Zoboli, R. (2006). Economic instruments and induced innovation: The EU policies on end of life vehicles. Ecological Economics, 58, 318–338.
Mazzanti, M., Montini, A., & Zoboli, R. (2008). Municipal waste generation, socio-economic drivers and waste management instruments. Journal of Environment and Development, 17, 51–69.
Porter, M. (1985). Competitive advantage. New York: The Free Press.
Porter, M., & van der Linde, C. (1995). Toward a new conception of the environment-competitiveness relationship. Journal of Economic Perspectives, 9, 97–118.
Reid, A., & Miedzinski, M. (2008). Sectoral innovation watch in Europe – Eco-innovation. Brussels: Europe Innova.
Rennings, K. (2000). Redefining innovation — Eco-innovation research and the contribution from ecological economics. Ecological Economics, 32, 319–332.
Schmalensee, R. (1989). Inter-industry studies of structure and performance. In R. Schmalensee & R. D. Willig (Eds.), Handbook of industrial organization (pp. 951–1009). Amsterdam: North Holland.
Tidd, J., Bessant, J., & Pavitt, K. (2005). Managing innovation. London: Wiley.
Wagner, J. (1992). Firm size, firm growth, and persistence of chance: Testing Gibrat’s law with establishment data from Lower Saxony, 1978–1989. Small Business Economics, 4, 125–131.
Wagner, J. (1995). Firm size and job creation in Germany. Small Business Economics, 7, 469–474.
Wagner, M. (2007). On the relationship between environmental management, environmental innovation and patenting: Evidence from German manufacturing firms. Research Policy, 36, 1587–1602.
Wagner, M. (2008). The influence of environmental management systems and tools on innovation: Evidence from Europe. Ecological Economics, 66, 392–402.
Wagner, M. (2011). Sustainability-related innovation and competitiveness-enhancing regulation: A qualitative and quantitative analysis in the context of open innovation. International Journal of Innovation and Sustainable Development, 5, 371–388.
Wagner, M., & Schaltegger, S. (2004). The effect of corporate environmental strategy choice and environmental performance on competitiveness. European Management Journal, 22, 557–572.
Ziegler, A., & Rennings, K. (2004). Determinants of environmental innovations in Germany: Do organizational measures matter? (ZEW Working Paper). Mannheim: ZEW.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2012 Springer Science+Business Media Dordrecht
About this chapter
Cite this chapter
Wagner, M. (2012). The Role and Effectiveness of Environmental and Social Regulations in Creating Innovation Offsets and Enhancing Firm Competitiveness. In: Costantini, V., Mazzanti, M. (eds) The Dynamics of Environmental and Economic Systems. Springer, Dordrecht. https://doi.org/10.1007/978-94-007-5089-0_5
Download citation
DOI: https://doi.org/10.1007/978-94-007-5089-0_5
Published:
Publisher Name: Springer, Dordrecht
Print ISBN: 978-94-007-5088-3
Online ISBN: 978-94-007-5089-0
eBook Packages: Business and EconomicsEconomics and Finance (R0)