Search

Begin New Search Publishing Institution Centre for International Environmental Studies, The Graduate Institute (IHEID) Author Joëlle Noailly Publication Year within 10 Years

1. Does environmental policy uncertainty hinder investments towards a low-carbon economy?

Author:
Joëlle Noailly, Laura Nowzohour, and Matthias Van Den Heuvel
Publication Date:
08-2022
Content Type:
Working Paper
Institution:
Centre for International Environmental Studies, The Graduate Institute (IHEID)
Abstract:
We use machine learning algorithms to construct a novel news-based index of US environmental and climate policy uncertainty (EnvPU) available on a monthly basis over the 1990-2019 period. We find that the EnvPU index spikes during the environmental spending disputes of the 1995-1996 government shutdown, in the early 2010s due the failure of the national cap-and-trade climate bill and during the Trump presidency. We examine how elevated levels of environmental policy uncertainty relate to investments in the low-carbon economy. In firm-level estimations, we find that a rise in the EnvPU index is associated with a reduced probability for cleantech startups to receive venture capital (VC) funding. In financial markets, a rise in our EnvPU index is associated with higher stock volatility for firms with above-average green revenue shares. At the macro level, shocks in our index lead to declines in the number of cleantech VC deals and higher volatility of the main benchmark clean energy exchange-traded fund. Overall, our results are consistent with the notion that policy uncertainty has adverse effects on investments for the low-carbon economy hindering progress to address the urgency of climate action.
Topic:
Environment, Finance, Economy, Investment, Institutions, and Decarbonization
Political Geography:
Global Focus

2. Financing energy innovation: internal finance and the direction of technical change

Author:
Joëlle Noailly and Roger Smeets
Publication Date:
09-2021
Content Type:
Working Paper
Institution:
Centre for International Environmental Studies, The Graduate Institute (IHEID)
Abstract:
Achieving the goals of the Paris Agreement and of climate neutrality by 2050 in the European Union will require mobilizing financial investments towards clean energy innovation. This study examines the role of internal finance (cash flows and cash holdings) and financing constraints for innovation in energy technologies. We construct a dataset for 1,300 Europeans combining balance-sheet information and patenting activities in renewable (REN) and fossil-fuel (FF) technologies and estimate the sensitivity of patenting activities to's internal finance. We use count estimation techniques and control for a large set of-specific characteristics and market developments in REN and FF technologies. We find that patenting activities ofs specialized in REN innovation are significantly more sensitive to a shock in cash flows thans specializing in FF innovation. Hence, our results emphasize that innovatives in clean energy may be particularly vulnerable to financing constraints. We discuss the implications of these results for energy transition policies aiming to redirect finance towards clean energy R&D.
Topic:
Environment, Science and Technology, European Union, Finance, Sustainable Development Goals, Innovation, and Energy
Political Geography:
Europe

3. Heard the news ? Environmental policy and clean investments

Author:
Joëlle Noailly, Laura Nowzohour, and Matthias Van Den Heuvel
Publication Date:
10-2021
Content Type:
Working Paper
Institution:
Centre for International Environmental Studies, The Graduate Institute (IHEID)
Abstract:
We build a novel news-based index of US environmental policy and examine how it relates to clean investments. Extracting text from ten leading US newspapers over the last four decades, we use text-mining techniques to develop a granular index measuring the salience of US environmental policy (EnvP) over the 1981-2019 period. We develop further a set of additional measures, namely an index of sentiment on environmental policy, as well as various topic-specific indices. We validate our index by showing that it correctly captures trends and peaks in the evolution of US environmental policy and that it has a meaningful association with clean investments, in line with environmental regulations supporting growing opportunities for clean markets. In firm-level estimations, we find that the salience of environmental policy in newspapers is associated with a greater probability of cleantech startups receiving venture capital (VC) funding and reduced stock returns for high-emissions firms most exposed to environmental regulations. At the aggregate level, we find in VAR models that a shock in our news-based index of renewable energy policy is associated with an increase in the number of clean energy VC deals and in the assets under management of the main benchmark clean energy exchange-traded fund. Overall, our EnvP index provides a lot of substantial information on environmental policy and can help assist the policy and financial community in understanding how these regulations are perceived by investors | providing many avenues for future research.
Topic:
Environment, Investment, Mining, and Carbon Emissions
Political Geography:
North America and United States of America

4. What do investors in electric vehicles technologies want?

Author:
Bettina Kast, Eva Bortolotti, and Joëlle Noailly
Publication Date:
09-2020
Content Type:
Policy Brief
Institution:
Centre for International Environmental Studies, The Graduate Institute (IHEID)
Abstract:
With 25% of worldwide emissions due to road transport, the deployment of electric vehicles (EVs), full battery electric vehicles and plug-in hybrid electric vehicles – presents many promises to mitigate climate change. Despite its rapid growth, the market share of EVs vehicle remains low in Europe. Norway leads the EV market with 10% of total vehicle stock, followed by Iceland (3.3%), the Netherlands (1.9%) and Sweden (1.6%) (IEA, 2019). This Policy Brief presents the results of a survey among European clean tech investors examining which policy instruments and design can best mobilize private investments to advance e-mobility technologies.
Topic:
Environment, Science and Technology, Green Technology, Private Sector, Transportation, and Ecology
Political Geography:
Europe, Norway, and Netherlands

5. Do financing constraints matter for the direction of technical change in energy R&D?

Author:
Joëlle Noailly and Roger Smeets
Publication Date:
03-2018
Content Type:
Research Paper
Institution:
Centre for International Environmental Studies, The Graduate Institute (IHEID)
Abstract:
The objective of this study is to examine the impact of firms' financing constraints on innovation activities in renewable (REN) versus fossil-fuel (FF) technologies. Our empirical methodology relies on the construction of a firm-level dataset for 1,300 European firms over the 1995-2009 period combining balance-sheet information linked with patenting activities in REN and FF technologies. We estimate the importance of the different types of financing (e.g. cash flow, long-term debt, and stock issues) on firms' patenting activities for the different samples of firms. We use count estimation techniques commonly used for models with patent data and control for a large set of firm-specific controls and market developments in REN and FF technologies. We find evidence for a positive impact of internal finance on patenting activities for the sample of firms specialized in REN innovation, while we find no evidence of this link for other firms, such as firms conducting FF innovation or large mixed firms conducting both REN and FF innovation. Hence, financing constraints matter for firms specialized in REN innovation but not for other firms. Our results have important implications for policymaking as the results emphasize that small innovative newcomers in the field of renewable energy are particularly vulnerable to financing constraints.
Topic:
Environment, Sustainable Development Goals, Green Technology, Renewable Energy, and R&D
Political Geography:
Global Focus

6. The Impact of Green Innovation on Energy Intensity: An Empirical Analysis for 14 Industrial Sectors in OECD Countries

Author:
Jules-Daniel Wurlod and Joëlle Noailly
Publication Date:
03-2016
Content Type:
Working Paper
Institution:
Centre for International Environmental Studies, The Graduate Institute (IHEID)
Abstract:
This paper analyses the impact of green innovation on energy intensity in a set of 14 industrial sectors in 17 OECD countries over the 1975-2005 period. We create a stock of green patents for each industrial sector and estimates a translog cost function to measure the impact of green innovation on energy intensity, next to other factors such as input substitution and autonomous technical change. We find that green innovation has contributed to the decline in energy intensity in the majority of sectors: the median elasticity of energy intensity with respect to green patenting is estimated at -0.03 in our sample. Hence, a 1% increase in green patenting activities in a given sector is associated with a 0.03% decline in energy intensity. The magnitude of the effect is larger in energy-intensive sectors and in more recent years. We also find that the impact of an additional green patent on energy intensity is larger than an average non-green patent. Our results are robust to alternative definitions of patents.
Topic:
Science and Technology, Green Technology, Innovation, Industry, Patents, OECD, and Energy
Political Geography:
Global Focus

Refine your search