This policy note investigates whether the current level of public support to environment-friendly technologies is sufficient to allow European countries to respond to the multiple challenges posed by climate change and other environmental concerns. We first lay out the justifications for...

Environmental regulations have consistently been found to spur innovation in "clean" technologies, with one significant exception. Past cap-and-trade programs have encouraged adoption of existing pollution control technologies, but had little effect on innovation. Several explanations have been...

We study the introduction of new technologies when their costs are subject to idiosyncratic uncertainty and can only be fully learned through individual experience. We set up a dynamic model of clean experience goods that replace old polluting consumption options and show how optimal regulation...

This article tests the effects of fuel economy and greenhouse gas emission standards on the direction of innovation, in particular on breakthrough technologies in the automotive industry. We develop an intuitive measure of standard stringency that captures the policy's most important features...

Custom software is distinct from other types of capital in that it is non-rival—once a firm makes an investment in custom software, it can be used simultaneously across its many establishments. Using confidential US Census data, we document that while firms with more establishments are more...

This paper analyzes the impact of internet adoption on labor productivity in Peruvian micro and small manufacturing firms over the period 2011-2013. Instrumental variables estimates show that internet adoption: (i) increases firms' labor productivity; (ii) reallocates employment away from...

This paper examines how product market competition affects firms' timing of adopting a new technology as well as whether the market provides sufficient adoption incentives. It shows that adoption dates differ not only among symmetric firms but also among markets with Cournot and Bertrand...

In this paper we replicate most of the stylized facts characterizing the decline in business dynamism in the USA highlighted by Akcigit and Ates (2021) and provide an explanation of their emergence by means of a macroeconomic agent-based model populated by two types of firms: innovators who...

Does access to information and communication technologies (ICT) increase innovation? We examine this question by exploiting the staggered adoption of BITNET across U.S. universities in the 1980s. BITNET, an early version of the Internet, enabled e-mail-based knowledge exchange and collaboration...