Skip to main content
SpringerLink
Log in

Stimulating ‘green’ technological innovation: An analysis of alternative policy mechanisms

  • Published:
Policy Sciences Aims and scope Submit manuscript

Abstract

As our understanding of human impacts on the environment has increased, it has become clear that we need to move toward a closed-loop industrial society in order to avoid undesirable health and ecosystem consequences. Achievement of this goal depends on radical technological innovation in both products and processes. This paper explores how to design public policy mechanisms to stimulate rather than impede pollution-preventing technological innovation. It begins with a discussion of the role of government in civilian technology development and diffusion. It then sets out six design criteria for policy to promote ‘green’ technology innovation. Based on this set of design criteria, the article assesses the potential and limitations of current U.S. policy approaches to stimulate technological innovation that moves us toward a minimal waste society. The main conclusions of this assessment are as follows. Over the past decade, the U.S. environmental policy system has experienced a variety of reforms and new initiatives, many aimed directly at promoting environmentally-friendly technological change. The strengths of these reforms are to increase the information that the private sector has about the magnitude and cost of their environmental impacts and to allow greater flexibility in the technologies that firms choose to meet environmental regulations and goals. Because of these reforms, firms are likely to undertake technological innovation for the environment in situations with clear short-term economic benefits, i.e. to capture the much heralded win-win potential of environmental regulation. However, these reforms have significant weaknesses as well. Unless policy provides stronger political or economic incentives and clearer signals about future environmental performance requirements, we are unlikely to be able to drive technological innovation in industries where the pay-off is more longterm or uncertain, and thus will make only limited progress toward the goal of a minimal waste society.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

References

  • Abernathy, W. J. and J. Utterback (1978). ‘Patterns of industrial innovation,’ Technology Review 80: 40–47.

    Google Scholar 

  • Amato, I. (1993). ‘The crusade against chlorine,’ Science 261: 152–154.

    Google Scholar 

  • Ashford, N. (1993). ‘Understanding technological responses of industrial ¢rms to environmental problems: Implications for government policy,’ in K. Fischer and J. Schot, Environmental Strategies for Industry. Washington, DC: Island Press.

    Google Scholar 

  • Ashford, N. A. (1994). ‘An innovation-based strategy for the environment,’ in A. Finkel and D. Golding, Worst Things First: The Debate Over Risk-based National Environmental Priorities. Washington, DC: Resources for the Future.

    Google Scholar 

  • Ashford, N. A., C. Ayers, et al. (1985). ‘Using regulation to change the market for innovation,’ The Harvard Environmental Law Review 9 (2): 419–466.

    Google Scholar 

  • Ashford, N. A. and G.R. Heaton (1983). ‘Regulation and technological innovation in the chemical industry,’ Law and Temporary Problems 46 (3): 109–157.

    Google Scholar 

  • Ayres, R.U. (1989). ‘Industrial metabolism,’ Technology and Environment. J.H. Ausubel and H.E. Sladovich. Washington, DC: National Academy Press: 23–49.

    Google Scholar 

  • Bacow, L. (1980). Chapter 2: ‘Command and control strategies,’ Bargaining for Job Safety and Health. Cambridge: MIT Press, pp. 12–21.

    Google Scholar 

  • Becker, M. and N. Ashford (1995). ‘Exploiting opportunities for pollution prevention in EPA enforcement agreements,’ Environmental Science and Technology 29 (5): 220A–226A.

    Google Scholar 

  • BioCycle (1994). ‘Duales system on ¢rmer ground in Germany,’ BioCycle (June): 61–63.

  • Branscomb, L.M., ed. (1983). Empowering Technology: Implementing a U.S. Strategy. Cambridge, MA: The MIT Press.

    Google Scholar 

  • Buelow, C. and M. A. Jacques (1996). Characteristics of innovative state pollution prevention programs and their potential application to EPA programs. Durham, NC: Nicholas School of the Environment, Duke University.

    Google Scholar 

  • Burt, J. and P. Dillon (1994). ‘What the U.S. can learn from Germany's packaging takeback system,’ Resource Recycling (September): 87–89.

  • Burtraw, D. (1996). ‘The SO2 emissions trading program: Cost savings without allowance trades,’ Contemporary Economic Policy XIV (April): 79–93.

    Google Scholar 

  • Colburn, T., D. Dumanoski, et al. (1996). Our Stolen Future. New York, The Penguin Group.

    Google Scholar 

  • Cooper, C. (1997). ‘Encouraging innovative environmental technologies: A comparison of three state initiatives,'Dept. of Urban Studies & Planning. Cambridge, MA: Massachusetts Institute of Technology.

    Google Scholar 

  • Dalpë, R. (1994). ‘Effects of government procurement on industrial innovation,’ Technology in Society 16 (1): 65–83.

    Google Scholar 

  • Ditz, D., J. Ranganathan, et al., eds. (1995). Green Ledgers: Case Studies in Corporate Environmental Accounting. Washington, DC: World Resources Institute.

    Google Scholar 

  • Eisele, J. (1996). ‘Green lights: Lighting the path to success,'Buildings: Construction & Management (March): 62–74.

  • EPA (1993). ‘Proposed rules,’ Effluent Limitations Guidelines, Pretreatment Standards, and New Source Performance Standards: Pulp, Paper, and Paperboard Category; National Emission Standards for Hazardous Air Pollutants for Source Category: Pulp and Paper Production; Proposed Rule. Washington, DC 58: pp. 66078–66216.

    Google Scholar 

  • EPA (1994). 1994 Toxics release inventory public data release. Washington DC: Environmental Protection Agency.

    Google Scholar 

  • EPA (1994). EPA's 33/50 Program fifth progress update. Washington DC: Environmental Protection Agency.

    Google Scholar 

  • EPA (1995). EPA's 33/50 Program company pro¢le reduction highlights, volume II. Washington DC: Environmental Protection Agency.

    Google Scholar 

  • EPA (1996). Partnerships in preventing pollution: A catalogue of the agency's partnership programs. Washington DC: Environmental Protection Agency, Office of the Administrator.

  • Frosch, R. (1995). ‘Industrial ecology: Adapting technology for a sustainable world,’ Environment 37 (10): 16–24, 34–37.

    Google Scholar 

  • Gottlieb, R., ed. (1995). Reducing Toxics: A New Approach to Policy and Industrial Decisionmaking. Washington, DC: Island Press.

    Google Scholar 

  • Graedel, T. E. and B.R. Allenby (1995). Industrial Ecology. Englewood Cliffs, New Jersey: Prentice Hall.

    Google Scholar 

  • Hausker, K. (1992). ‘The politics and economics of auction design in the market for sulfur dioxide pollution', Journal of Policy Analysis and Management 11 (4): 553–572.

    Google Scholar 

  • Hoerner, A. J. (1995). ‘Life and Taxes,’ The Amicus Journal (Summer): 14–17.

  • Hill, C.T. and J. Utterback (1979). ‘Environmental health and safety regulation and technological innovation,’ Technological Innovation for a Dynamic Economy. C.T. Hill and J. Utterback. New York: Pergamon Press, pp. 200–204.

    Google Scholar 

  • INFORM (1995). Toxics Watch 1995. New York: Inform, Inc.

    Google Scholar 

  • Jung, C., K. Krutilla, et al. (1996). ‘Incentives for advanced pollution abatement technology at the industry level: An evaluation of policy alternatives,’ Journal of Environmental Economics and Management 30: 95–111.

    Google Scholar 

  • Katz, B. and A. Phillips (1982). ‘The computer industry,’ in R.R. Nelson, Government and Technical Progress: ACross-Industry Analysis. Nelson. New York: Pergamon Press, pp. 162–232.

    Google Scholar 

  • Langeweg, I. F., ed. (1989). Concern for Tomorrow: A National Environmental Survey 1985–2010. Bilthoven, The Netherlands, National Institute of Public Health and Environmental Protection.

    Google Scholar 

  • Levin, R.C. (1982). ‘The semiconductor industry,'' in R.R. Nelson, Government and Technical progress: ACross-Industry Analysis. New York: Pergamon Press, pp. 9–100.

    Google Scholar 

  • Levin, M.H. (1990). ‘Implementing pollution prevention: Incentives and irrationalities,'Air & Waste Management Association 40 (9): 1227–1231.

    Google Scholar 

  • Milliman, S. and R. Prince (1989). ‘Firm incentives to promote technological change in pollution control,’ Journal of Environmental Economics and Management 17: 247–265.

    Google Scholar 

  • Mowery, D. and N. Rosenberg (1979). The influence of market demand upon innovation: A critical review of some recent empirical studies,'Research Policy 12 (2): 102–153.

    Google Scholar 

  • Mowery, D. and N. Rosenberg (1982). ‘The commercial aircraft industry,’ in R.R. Nelson, Government and Technical Progress: A Cross-Industry Analysis. New York: Pergamon Press: pp. 101–161.

    Google Scholar 

  • Nelson, R.R. (1982). ‘Government stimulus of technological process: Lessons from American history,’ Government and Technical Progress: ACross-Industry Analysis. New York: Pergamon Press.

    Google Scholar 

  • Newell, R.G., A. B. Jaffe, et al. (1996). Environmental policy and technological change: The e¡ect of economic incentives and direct regulation on energy-saving innovation. Cambridge, MA: Kennedy School of Government, Harvard University.

    Google Scholar 

  • OECD (1995). Environmental taxes in OECD countries. Paris, Organisation for Economic Cooperation and Development.

    Google Scholar 

  • OTA (1995). Environmental Policy Tools. Washington DC: U.S. Government Printing Office.

    Google Scholar 

  • Parson, E. (1996). ‘International protection of the ozone layer,’ in H.O. Bergesen and G. Parmann, Green Globe Yearbook of International Co-operation on Environment and Development. Oxford: Oxford University Press.

    Google Scholar 

  • Pavitt, K. (1984). ‘Sectoral patterns of technical change: Towards a taxonomy and a theory,’ Research Policy 13 (6): 343–373.

    Google Scholar 

  • Porter, M. and C. van der Linde (1995). ‘Toward a new conception of the environment-competitiveness relationship,’ Journal of Economic Perspectives 9 (4): 97–118.

    Google Scholar 

  • Porter, M. E. and C. van der Linde (1995). ‘Green and competitive: Ending the stalement,’ Harvard Business Review (September/October).

  • Portney, P.R. ed. (1990). Public Policies for Environmental Protection. Washington DC: Resources for the Future.

    Google Scholar 

  • President's Council on Sustainable Development (1996). Sustainable America: A new consensus for prosperity, opportunity, and a healthy environment for the future. Washington, DC: The President's Council on Sustainable Development.

    Google Scholar 

  • Rip, A. (1995). ‘Introduction of new technology: Making use of recent insight from sociology and economics of technology', Technology Analysis and Strategic Management 7 (4): 417–431.

    Google Scholar 

  • Roessner, J.D. (1984). ‘Commercializing solar technology: The government role,’ Research Policy 13 (4): 235–246.

    Google Scholar 

  • Rothwell, R. (1992). ‘Industrial innovation and government environmental regulation: Some lessons from the past,’ Technovation 12 (7): 447–458.

    Google Scholar 

  • Rothwell, R. and W. Zegveld (1981). Industrial Innovation and Public Policy: Preparing for the 1980s nd 1990s. Westport, CT: Greenwood Press.

    Google Scholar 

  • Rousso, A. S. and S. P. Shah (1994). ‘Packaging taxes and recycling incentives: The German green dot program,’ National Tax Journal XLVII (3): 689–701.

    Google Scholar 

  • Roy, M. and L. A. Dillard (1990). ‘Toxics use reduction in Massachusetts: The blackstone project,’ Journal of the Air & WasteManagement Association: 1.

  • Ryan (1993). ‘Packaging a revolution,’ WorldWatch (September/October): 28–34.

  • Schmidheiny, S. (1992). Changing Course: A Global Business Perspective on Development and the Environment. Cambridge, MA: MIT Press.

    Google Scholar 

  • Schmitt-Tegge, J. (1990). The German packaging ordinance and its consequences.

  • Schot, J. (1992). ‘Constructive technology assessment and technology dynamics: The case of clean technologies,’ Science, Technology and Human Values 17: 36–56.

    Google Scholar 

  • Sekutowski, J.C. (1994). ‘Greening the telephone: A case study,’ in B. R. Allenby and D. J. Richards, The Greening of Industrial Ecosystems. Washington, DC: National Academy Press: pp. 171–177.

    Google Scholar 

  • Smart, B., ed. (1992). Beyond Compliance: A New Industry View of the Environment. World Resources Institute.

  • Stoughton, M.D. (1995). ‘An evaluation of voluntary programs as public policies for environmental protection,’ Civil and Environmental Engineering. Cambridge, MA: Massachusetts Institute of Technology.

    Google Scholar 

  • Tietenberg, T. (1995). ‘Tradeable permits for pollution control when emission location matters: What have we learned?,’ Environmental and Resource Economics 5: 95–113.

    Google Scholar 

  • Todd, J.A. (1977). Review of the common sense initiative. Gaithersburg, MD: The Scienti¢c Consulting Group, Inc.

    Google Scholar 

  • Rothwell, R. (1992). ‘Industrial innovation and government environmental regulation: Some lessons from the past,’ Technovation 12 (7): 447–458.

    Google Scholar 

  • Wallace, D. (1995). Environmental Policy and Industrial Innovation: Strategies in Europe, the U.S. and Japan. London, Earthscan Publications Ltd.

    Google Scholar 

  • Walsh, V. (1993). ‘Demand, public markets and innovation in biotechnology,’ Science and Public Policy 20 (3): 138–156.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Environmental Policy Group, Department of Urban Studies and Planning, Massachusetts Institute of Technology, Cambridge, MA, 02139, U.S.A

    Vicki Norberg-Bohm

Authors
  1. Vicki Norberg-Bohm
    View author publications

    You can also search for this author in PubMed Google Scholar

Rights and permissions

Reprints and permissions

About this article

Cite this article

Norberg-Bohm, V. Stimulating ‘green’ technological innovation: An analysis of alternative policy mechanisms. Policy Sciences 32, 13–38 (1999). https://doi.org/10.1023/A:1004384913598

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1023/A:1004384913598

Keywords

Search

Navigation