Eco-innovation : Spanish service and manufacturing firms

Abstract

The drivers for the adoption of an eco-innovation strategy have been widely explored in the recent literature but, to date, most of these studies have been carried out on manufacturing industries. Hence, this paper investigates the similarities and differences between service and manufacturing firms, distinguishing between the high-tech and lowtech sectors. Using panel data of 4,535 Spanish firms for the period 2008—2014, we specify a dynamic probit model with sample selection. In line with other contributions in the literature, our results confirm the importance of regulatory stimulus to eco-innovation, mainly in form of demand-pull and, especially, in terms of demand push (subsidies) for sectors with low technology intensities. Institutional sources of information seem to be a more important driver for services firms with high technology intensity, whereas manufacturing firms rely more on internal or other sources of information. Furthermore, we find that eco-innovation is highly persistent at the firm level in both sectors and at both technology intensities. Hence, past eco-innovation behaviour is clearly more decisive in explaining the current state of eco-innovation orientation. Keywords: eco-innovation strategy, environmental innovation, service sector, manufacturing sector, green strategy, Spain. JEL Classification Numbers: O31. Q55