Innovation Dynamics In The Renewable Energy Sector

This paper investigates the role of cross-country spillovers in renewable energy technologies. The balance between international and domestic knowledge sourcing in energy innovation is still an open question. Recent studies show that a few countries develop new high-quality technologies, but follower countries cannot limit themselves to importing such technologies, they should also undertake adaptive and absorptive R&D efforts. Relying on a knowledge production function, we model the innovation dynamics of 18 OECD countries throughout the 1990-2006 period. Our findings show that, after controlling for climate-energy policies, domestic R&D determines renewable energy innovations, but international knowledge spillovers are also relevant. Additionally, the stronger the connections/linkages between countries, the more likely spillovers are of occurring.