Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/101958
Authors: 
Jin, Wei
Zhang, ZhongXiang
Year of Publication: 
2014
Series/Report no.: 
Nota di Lavoro, Fondazione Eni Enrico Mattei 18.2014
Abstract: 
As a useful complement to numerous innovation policy studies from a normative perspective, this paper provides a positive framework to analyze the basic economic mechanism of energy technological innovation and explains its slow pace of technological progress. We find that the capital-intensiveness of energy technology is an inhibiting factor to catalyze market size effect and slows innovations and diffusions of energy technology in the market. We also show that the substantial homogeneity of energy products leads to both a monopolistic market structure on the supply side and a weak level of positive pecuniary externality on the demand side, both dampening the incentive of innovation. On the basis of our economic analysis, we recommend that a package of policy responses to accelerating energy innovation should include 1) downsizing “heavy” assets of energy technologies; 2) deregulating monopolistic energy-supplying markets; and 3) differentiating the homogenous energy products.
Subjects: 
The Economics of Technological Innovation
Market Size Effect
Love-for-variety effect
Energy Technology
IT Technology
JEL: 
Q55
Q58
Q43
Q48
O31
Document Type: 
Working Paper

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