Environmental Policy Essay

1040 Words 5 Pages
Environmental policy is often regarded as one of the main drivers of environmental innovation (Porter and van der Linde, 1995b). The adverse effects of most environmental problems resulted in environmental innovation being less market-driven and more regulatory motivated. Porter and van der Linde (1995b) advocate that environmental regulation may result in a win-win situation: pollution being reduced and profits increased. This argument is famously termed the Porter Hypothesis and is largely based on evolutionary innovation theory (Nelson and Winter, 1982). Nelson and Winter (1982) postulate that a firm’s innovative behaviour is hardly an optimisation process; rather it often follows rules of thumb and routines, due to the large …show more content…
Local firms and countries’ wider economy will therefore benefit from first-mover advantages when developed innovations are subsequently widely diffused (Porter and van der Linde, 1995b).

However , the influence of Government regulatory policies on demand for innovation in the construction industry is an area with conflicting findings (Dubois and Gadde, 2002; Oster and Quigley, 1977; Bernstein, 1996; Larsson, 1996; Gann et al., 1998; Guy and Kibert; 1998; Bon and Hutchinson, 2000; Ngowi, 1998, 2001; Seaden and Manseau, 2001, Ryghaug and Sørensen, 2009).

Dubois and Gadde (2002) argue that many government policies and industry standards often dampen efforts for innovation. Early work by Oster and Quigley (1977) explored the impact of US 1970s regulation on the diffusion of innovation and concluded that building codes and regulation can slow the adoption of innovation. Gann et al. (1998) studied the diffusion of energy efficiency in UK Commercial buildings. Their findings suggest that regulation in the UK neither inhibit nor stimulate the adoption of energy efficient innovations. Ryghaug and Sørensen (2009) highlighted the deficiencies in Norwegian public policy in stimulating energy-efficient innovation. According to them, the Norwegian energy policy’s focus on optimising energy use or reducing energy cost has placed energy efficiency in the “iron cage of economics”. Manseau and

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