The effect of environmental innovations on employment changes: an econometric analysis

This paper examines the determinants of employment changes due to an environmental innovation of an establishment. The data stem from telephone surveys in five European countries. 1594 interviews have been realized with environmentally innovative establishments representing the European industry and service sector. Based on results of discrete choice models, we show that if the most important environmental innovation is a product or service innovation it has a significantly positive effect on the probability of an increase in employment compared with the probability of no noticeable change. In contrast, if the most important environmental innovation is an end-of-pipe innovation it has a significantly positive influence on employment decrease. Methodologically, we consider the multinomial logit model and several multinomial probit models. We find that the estimates of the parameters of the explanatory variables are very similar in the different approaches. Copyright © 2004 John Wiley & Sons, Ltd and ERP Environment.

[1]  J. Hemmelskamp,et al.  Environmental policy instruments and their effects on innovation , 1997 .

[2]  Klaus Rennings,et al.  Employment impacts of cleaner production , 2003 .

[3]  Michael Keane,et al.  A Computationally Practical Simulation Estimator for Panel Data , 1994 .

[4]  Thomas Zwick.  Employee resistance against innovations , 2002 .

[5]  John Van Reenen,et al.  Employment and Technological Innovation: Evidence from U.K. Manufacturing Firms , 1997 .

[6]  D. Third.  OECD/Eurostat . Oslo Manual-Guidelines for Collecting and Interpreting Technological Innovation Paris, France: , 2005 .

[7]  H. White.  Maximum Likelihood Estimation of Misspecified Models , 1982 .

[8]  K. Rennings,et al.  Determinants of environmental product and process innovation , 1999 .

[9]  M. Pianta.  The employment impact of product and process innovations , 2000 .

[10]  K. Rennings.  Redefining innovation -- eco-innovation research and the contribution from ecological economics , 2000 .

[11]  Lung-fei Lee,et al.  STATISTICAL INFERENCE WITH SIMULATED LIKELIHOOD FUNCTIONS , 1999, Econometric Theory.

[12]  Klaus Rennings,et al.  Employment Impacts of Cleaner Production - Evidence from a German Study Using Case Studies and Surveys , 2001 .

[13]  Klaus F. Zimmermann,et al.  The employment consequences of technological advance, demand and labor costs in 16 German industries , 1991 .

[14]  A. Campbell,et al.  Corporate strategy: The quest for parenting advantage , 1995 .

[15]  V. Hajivassiliou,et al.  Smooth unbiased multivariate probability simulators for maximum likelihood estimation of limited dependent variable models , 1993 .

[16]  J. Geweke,et al.  Alternative computational approaches to inference in the multinomial probit model , 1994 .

[17]  David Pearce,et al.  The Role of Carbon Taxes in Adjusting to Global Warming , 1991 .

[18]  Christian Gourieroux,et al.  Simulation-based econometric methods , 1996 .

[19]  Wim P. M. Vijverberg,et al.  Monte Carlo evaluation of multivariate normal probabilities , 1997 .

[20]  Paul R. Milgrom,et al.  Organizational Prospects, Influence Costs, and Ownership Changes , 1992 .

[21]  Michael Keane,et al.  A Note on Identification in the Multinomial Probit Model , 1992 .

[22]  Paul A. Ruud,et al.  Simulation of multivariate normal rectangle probabilities and their derivatives theoretical and computational results , 1996 .

[23]  Alfred Kleinknecht,et al.  Employment growth and innovation at the firm level , 1993 .

[24]  M. Vivarelli,et al.  The analysis of technological change and employment , 2003 .

[25]  John Geweke,et al.  Statistical inference in the multinomial multiperiod probit model , 1997 .

[26]  Horst Rottmann,et al.  The Labour Demand and the Innovation Behaviour of Firms / Die Arbeitsnachfrage und das Innovationsverhalten von Unternehmen , 1998 .

[27]  L. Goulder,et al.  Optimal Environmental Taxation in the Presence of Other Taxes: General Equilibrium Analyses , 1994 .