This website uses cookies.

By clicking the "Accept" button or continuing to browse our site, you agree to first-party and session-only cookies being stored on your device to enhance site navigation and analyze site performance and traffic. For more information on our use of cookies, please see our Privacy Policy.

  1. Home
  2. Journals
  3. American Economic Review: Insights
  4. Forthcoming Articles
  5. Induced Innovation, Inventors, and the Energy Transition

American Economic Review: Insights

ISSN 2640-205X (Print) | ISSN 2640-2068 (Online)

Induced Innovation, Inventors, and the Energy Transition

  • Eugenie Dugoua
  • Todd D. Gerarden
American Economic Review: Insights (Forthcoming)

Abstract

We study how individual inventors respond to incentives to work on “clean” electricity technologies. Using natural gas price variation, we estimate output and entry elasticities of inventors and measure the medium-term impacts of a price increase mirroring the social cost of carbon. We find that the induced clean innovation response primarily comes from existing clean inventors. New inventors are less responsive on the margin than their average contribution to clean energy patenting would indicate. Our results strengthen the rationale for government intervention to expedite the energy transition.

Downloads