Environmental innovation and employment: Drivers and synergies

Abstract

Numerous empirical studies focus on the drivers of environmental innovation or their potential employment effects. Nevertheless, we have scarce knowledge about whether factors that influence eco-innovation and employment generation are related. The main purpose is to analyze the synergies between eco-innovation and employment using a sample of more than 6000 innovative Spanish manufacturing and service firms. Using different econometric procedures, the main findings show that size, R&D and export influence eco-innovation and employment in the same direction, while age, belonging to a group, public subsidies and internal and external knowledge sources exert a different effect. Thus, older firms create less employment but have a high probability of being environmental innovators compared with younger firms. Furthermore, the size of the company moderates the positive role of eco-innovation on employment growth, while young firms not belonging to a group (eco-entrepreneurs) contribute more to employment growth than old firms belonging to a parent firm. Implications for scholars, managers and policy makers in terms of sustainable and economic growth are made.