Strategies for green industrial and innovation policy–an analysis of policy alignment, misalignment, and realignment around dominant designs in the EV sector
Governments in industrialized as well as emerging economies are racing to implement policies to accelerate clean energy innovation and capture the economic benefits of decarbonization. This paper explores which combination of technology-push and demand-pull policies best situates a country to lead i...
| Main Authors: | , , |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
IOP Publishing
2023-01-01
|
| Series: | Environmental Research Letters |
| Subjects: | |
| Online Access: | https://doi.org/10.1088/1748-9326/ad101e |
| _version_ | 1827583887412297728 |
|---|---|
| author | Easwaran Narassimhan Zdenka Myslikova Kelly Sims Gallagher |
| author_facet | Easwaran Narassimhan Zdenka Myslikova Kelly Sims Gallagher |
| author_sort | Easwaran Narassimhan |
| collection | DOAJ |
| description | Governments in industrialized as well as emerging economies are racing to implement policies to accelerate clean energy innovation and capture the economic benefits of decarbonization. This paper explores which combination of technology-push and demand-pull policies best situates a country to lead in clean energy innovation, as new or dominant designs emerge and replace older technologies. A new analytical framework for green industrial policy is introduced regarding the alignment, misalignment, and deliberate misalignment of policies. This framework is applied to battery electric vehicle drivetrain technology to examine the use of policy alignment and misalignment by countries with big automakers as they pursue strategic green industrial policy. We find that countries that achieved early and sustained (not inconsistent) policy alignment gained a first-mover advantage compared with countries that deliberately or accidentally misaligned their policies. We also find that first-mover advantage can be lost due to deliberate misalignment of policies caused by an inability of governments to effectively incentivize their firms to develop and deploy cleaner and more efficient technologies. In situations where governments adopt misaligned or conflicting policies, incumbent industries tend to pursue their prior comparative advantage and maximize return from investments in prior technologies. We also find that deliberate misalignment of policies can be an effective catching-up strategy. |
| first_indexed | 2024-03-08T23:14:11Z |
| format | Article |
| id | doaj.art-25080b7aaf19497c91b9b251535df095 |
| institution | Directory Open Access Journal |
| issn | 1748-9326 |
| language | English |
| last_indexed | 2024-03-08T23:14:11Z |
| publishDate | 2023-01-01 |
| publisher | IOP Publishing |
| record_format | Article |
| series | Environmental Research Letters |
| spelling | doaj.art-25080b7aaf19497c91b9b251535df0952023-12-15T07:12:05ZengIOP PublishingEnvironmental Research Letters1748-93262023-01-0119101402910.1088/1748-9326/ad101eStrategies for green industrial and innovation policy–an analysis of policy alignment, misalignment, and realignment around dominant designs in the EV sectorEaswaran Narassimhan0https://orcid.org/0000-0001-8910-2246Zdenka Myslikova1Kelly Sims Gallagher2Sustainable Futures Collaborative , New Delhi, India; Climate Policy Lab, The Fletcher School, Tufts University , Medford, MA, United States of AmericaClimate Policy Lab, The Fletcher School, Tufts University , Medford, MA, United States of AmericaClimate Policy Lab, The Fletcher School, Tufts University , Medford, MA, United States of AmericaGovernments in industrialized as well as emerging economies are racing to implement policies to accelerate clean energy innovation and capture the economic benefits of decarbonization. This paper explores which combination of technology-push and demand-pull policies best situates a country to lead in clean energy innovation, as new or dominant designs emerge and replace older technologies. A new analytical framework for green industrial policy is introduced regarding the alignment, misalignment, and deliberate misalignment of policies. This framework is applied to battery electric vehicle drivetrain technology to examine the use of policy alignment and misalignment by countries with big automakers as they pursue strategic green industrial policy. We find that countries that achieved early and sustained (not inconsistent) policy alignment gained a first-mover advantage compared with countries that deliberately or accidentally misaligned their policies. We also find that first-mover advantage can be lost due to deliberate misalignment of policies caused by an inability of governments to effectively incentivize their firms to develop and deploy cleaner and more efficient technologies. In situations where governments adopt misaligned or conflicting policies, incumbent industries tend to pursue their prior comparative advantage and maximize return from investments in prior technologies. We also find that deliberate misalignment of policies can be an effective catching-up strategy.https://doi.org/10.1088/1748-9326/ad101einnovationgreen industrial policyelectric vehicles |
| spellingShingle | Easwaran Narassimhan Zdenka Myslikova Kelly Sims Gallagher Strategies for green industrial and innovation policy–an analysis of policy alignment, misalignment, and realignment around dominant designs in the EV sector Environmental Research Letters innovation green industrial policy electric vehicles |
| title | Strategies for green industrial and innovation policy–an analysis of policy alignment, misalignment, and realignment around dominant designs in the EV sector |
| title_full | Strategies for green industrial and innovation policy–an analysis of policy alignment, misalignment, and realignment around dominant designs in the EV sector |
| title_fullStr | Strategies for green industrial and innovation policy–an analysis of policy alignment, misalignment, and realignment around dominant designs in the EV sector |
| title_full_unstemmed | Strategies for green industrial and innovation policy–an analysis of policy alignment, misalignment, and realignment around dominant designs in the EV sector |
| title_short | Strategies for green industrial and innovation policy–an analysis of policy alignment, misalignment, and realignment around dominant designs in the EV sector |
| title_sort | strategies for green industrial and innovation policy an analysis of policy alignment misalignment and realignment around dominant designs in the ev sector |
| topic | innovation green industrial policy electric vehicles |
| url | https://doi.org/10.1088/1748-9326/ad101e |
| work_keys_str_mv | AT easwarannarassimhan strategiesforgreenindustrialandinnovationpolicyananalysisofpolicyalignmentmisalignmentandrealignmentarounddominantdesignsintheevsector AT zdenkamyslikova strategiesforgreenindustrialandinnovationpolicyananalysisofpolicyalignmentmisalignmentandrealignmentarounddominantdesignsintheevsector AT kellysimsgallagher strategiesforgreenindustrialandinnovationpolicyananalysisofpolicyalignmentmisalignmentandrealignmentarounddominantdesignsintheevsector |