Given that the threat of human induced climate change is considered the greatest challenge of our time, economic growth has to be sustainable.
We examine the determinants of the main culprit in climate change: greenhouse gas emissions (GHG). Our focus is businesses, responsible for about one-third of GHG emissions in industrialised countries. We find that management practices account for a considerable amount of the variation in emissions found, even in similar business sectors. The programme has carried out evaluations of emissions-reduction schemes such as the European Emissions Trading Scheme and the Climate Change Levy as well as considering impacts on competitiveness and economic performance, a major issue for policy makers.
Businesses are not only polluters but can be innovators in the development of new emission-reducing products, services and processes. An important focus of our research is the drivers of clean innovation (including taxation of dirty innovation) and how policy can efficiently incentivise it. Research using patent citations data suggests that knowledge spillovers from clean innovation exceed those from dirty (carbon-based) innovation. This suggests that short-run as well as longer-run growth effects would occur from a transition to cleaner technologies and climate change policies.
Turning from producers to consumers of energy, we are conducting random controlled trials to see which behavioural incentives and technology (eg smart meters) work to reduce domestic energy consumption or shift its demand to match the natural variations of renewable resources such as solar or wind.
Sustainable Growth in the UK
In this special report for the LSE Growth Commission James Rydge, Ralf Martin and Anna Valero show why it is sensible for environmental sustainability to be at the heart of the UK's growth strategy and provide recommendations how this can be achieved. Read more...
The Impact of 'Clean Innovation' on Economic Growth: Evidence from the Transport and Energy Industries
Ralf Martin explains how UK climate policy consists of a patchwork of instruments addressing greenhouse gas emissions from a variety of sources and resulting in a diverse menu of carbon prices. And while the country's recent record on cutting carbon emissions seems impressive at first glance, much of it has been a result of the reduction in economic activity in the Great Recession. Read more...
Clean growth publications
Antoine Dechezleprêtre, Cal B. Muckley and Parvati Neelakantan
2 July 2020
Ralf Martin, Sam Unsworth, Anna Valero and Dennis Verhoeven
13 February 2020
James Rydge, Ralf Martin and Anna Valero
3 December 2018
Genevieve Alberts, Zeynep Gurguc, Pantelis Koutroumpis, Ralf Martin, Mirabelle Muûls and Tamaryn Napp
1 September 2016
4 November 2014
Ralf Martin, Ulrich J. Wagner and Laure B. de Preux
1 September 2014
Ralf Martin, Mirabelle Muûls, Ulrich J. Wagner and Laure B. de Preux
1 August 2014
Philippe Aghion, Antoine Dechezleprêtre, David Hemous, Ralf Martin and John Van Reenen
30 November 2012