Climate variability, innovation and firm performance: evidence from the European agricultural sector
Abstract It is generally accepted that adaptation to climate variability requires a technological advancement strategy. However, the innovation process has received little explicit consideration in this framework. We employ a panel endogenous switching regression model to explore whether and to what extent climate variability affects firm performance through the ability to induce the development of adaptation innovations in key resource-based sectors in Europe during the period 2007–2017. Our findings confirm that the knowledge generation process at the heart of climate change adaptation technologies enhances firm performance, especially for firms in the aquaculture and fishing sub-sectors …
Innovation for climate change adaptation and technical efficiency: an empirical analysis in the European agricultural sector
This paper analyses the effect of innovation on firms' technical efficiency. Using climate-related patent data to proxy for innovation activity in different technological fields, the paper employs a stochastic frontier approach to estimate the impact of innovative efforts on agricultural firms' technical efficiency taking account of both unobservable heterogeneity and double heteroscedasticity in the inefficiency and idiosyncratic terms. Our findings confirm that innovation has a positive impact on firms' productivity (technical efficiency). While agricultural firms located in Germany and Sweden are more efficient compared to those in southern countries, all the European countries considere…