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- 22 Aug 2013
- Working Paper Summaries
From Green Users to Green Voters
Does the diffusion of technology affect voting patterns? Technology is usually not aligned with a specific ideology or political party. Indeed, to the extent that technology raises living standards, all parties tend to favor technology diffusion. However, in some cases, voters may associate a political party with a specific technology. Green parties, for example, advocate for the diffusion of green energy technologies and pursue policies that foster the diffusion of green energies. This paper finds a significant effect of photovoltaic (PV) adoption on the increase in the share of votes for Germany's Green Party. In particular, the increase in the diffusion rate of PV systems between 1998 and 2009 led to an increase in the fraction of green votes of 1 percent, which represents 25 percent of the actual increase in the voting rate experienced by the Green Party between 1998 and 2009. Key concepts include: This study uncovered the impact that the diffusion of PV systems has on the votes obtained by Germany's Green Party. Individuals that use green technologies are more likely to become Green Party voters. Approximately a quarter of the increase in the share of votes experienced by the Green Party between 1998 and 2009 is driven by the diffusion of PV systems. In contrast, there were no such effects from the diffusion of industrial PV systems and eolic systems. This contrast confirms the importance of voters' direct involvement with the adoption and/or operation of the technology for this to affect their voting patterns. Closed for comment; 0 Comments.
- 05 Jun 2013
- Op-Ed
Corporate Leaders Need to Step Up on Climate Change
Despite perceptions that sustainable business efforts are progressing, the environment reminds us we're failing to deal with the problem sufficiently. Here's what business leaders must do next, according to Michael Toffel and Auden Schendler. Closed for comment; 0 Comments.
- 22 Apr 2013
- Research & Ideas
Earth Day: Recent Research on Sustainability
Earth Day helps us reflect on environmental issues that both sustain and threaten our planet. Harvard Business School researchers have approached these issues pragmatically, conducting numerous studies aimed at helping business leaders to understand how business affects the environment, and vice versa. Here is a sample of that work. Closed for comment; 0 Comments.
- 07 Mar 2013
- Research & Ideas
Video: Harvard Business School at the Kumbh Mela
In this video report, Senior Lecturer John Macomber visits the Kumbh Mela in India to discover what such an undertaking can teach us about real estate, urbanization, sustainability, and infrastructure. Open for comment; 0 Comments.
- 10 Jan 2013
- Working Paper Summaries
Pay for Environmental Performance: The Effect of Incentive Provision on Carbon Emissions
Research has shown that reducing carbon emissions and exhibiting good environmental performance are important for corporations. But how exactly are these environmental goals carried out within organizations? In this paper, the authors analyze the incentive structures of climate change management for a sample of large, predominantly multinational organizations. The authors then characterize and assess the effectiveness of different types of incentive schemes that corporations have adopted to encourage employees to reduce carbon emissions. Results suggest that contrary to widespread belief in the effectiveness of monetary incentives, in fact the adoption of monetary incentives is associated with higher carbon emissions. By contrast, the use of nonmonetary incentives is associated with lower carbon emissions. Overall, the study suggests that socially positive tasks significantly impact the effectiveness of different types of incentives and should be considered in the design of accounting and control systems. Key concepts include: Monetary incentives are associated with higher carbon emissions. Non-monetary incentives are associated with lower carbon emissions. When employees perceive their action as socially positive, the adoption of non-monetary incentives might be more effective than monetary incentives in reducing carbon emissions. For tasks involving socially positive behavior, monetary incentives are not effective and actually detrimental unless they are provided to people for whom such tasks constitute part of their formal job responsibility. Closed for comment; 0 Comments.
- 26 Dec 2012
- Working Paper Summaries
Reinforcing Regulatory Regimes: How States, Civil Society, and Codes of Conduct Promote Adherence to Global Labor Standards
Multinational corporations are under increasing pressure to manage their global supply chains in ways that are environmentally sustainable and socially responsible. Many companies have responded to this pressure by asking their suppliers to adhere to codes of conduct governing labor conditions and environmental management. This paper examines the conditions under which tens of thousands of suppliers across many countries are more likely to adhere to the labor practices these codes of conduct call for. Findings indicate that suppliers are more likely to adhere to codes of conduct in countries that not only have made binding domestic and international legal commitments to protect workers' rights, but that also have high levels of press freedom and nongovernmental organization activity. Greater code of conduct adherence is also found among suppliers that serve buyers located in countries where child labor is a more salient issue. This research reveals the critical importance of maintaining multiple, overlapping, and reinforcing governance systems, and urges caution to those hoping that private regulatory regimes can substitute for effective government regulation. Overall, this paper points the way toward building more effective private regulatory regimes. Key concepts include: Global labor standards were most successfully implemented in countries that made significant formal and binding connections to the international community through their labor treaty ratifications and reinforced these connections by enacting stringent domestic employment legislation. By maintaining a free press, national governments also play a key role in promoting adherence to global labor standards. National governments can influence labor practices in their country not only by enacting legislation and signing international treaties, but also by protecting press freedom and non-governmental organizations to enable civil society scrutiny and mobilization. Political and consumer pressure in multinational corporations' home markets can have a substantive impact on how these companies manage working conditions in their global supply chains, well beyond the mere symbolic act off deploying codes of conduct. Closed for comment; 0 Comments.
- 19 Nov 2012
- Research & Ideas
LEED-ing by Example
When a local government decides to pursue environmentally aware construction policies for its own buildings, the private sector follows suit, according to new research by Timothy Simcoe and Michael W. Toffel. Closed for comment; 0 Comments.
- 15 Nov 2012
- Research & Ideas
Funding the Design of Livable Cities
As a burgeoning global population migrates to the world's urban centers, it's crucial to design livable cities that function with scarce natural resources. John Macomber discusses the critical connection between real estate financing and innovative design in the built environment. Open for comment; 0 Comments.
- 14 Nov 2012
- Research & Ideas
New Agenda for Corporate Accountability Reporting
Professor Karthik Ramanna explains three ways to make corporate accountability reports potentially more useful to constituencies that include shareholders, communities, bondholders, and customers. Open for comment; 0 Comments.
- 06 Nov 2012
- Op-Ed
Stop Talking About the Weather and Do Something: Three Ways to Finance Sustainable Cities
How do we ensure that our cities are resilient in the face of inevitable future weather events like Hurricane Sandy? John Macomber offers three ways that the private sector can take action. Open for comment; 0 Comments.
- 21 Sep 2012
- Working Paper Summaries
Public Procurement and the Private Supply of Green Buildings
Government purchasing programs often have policy objectives that go beyond getting a good deal for the taxpayer. For example, governments may purchase products with enhanced environmental or safety features not only to reduce environmental impacts and safeguard employees, but also to promote broader adoption of similar products in the private market. Such policies have been deployed by governments across the United States and European Union, but little is known about how well they actually work. This paper examines the impact of environmentally friendly government procurement policies on private-sector adoption of the targeted products. The authors find that municipal government green building procurement policies that apply only to municipal buildings also accelerate the use of green building practices in the private sector, both in the cities with these policies as well as in neighboring cities. They also find that such government policies encourage private-sector investment in complementary services, which likely reduces green building costs to private developers. Key concepts include: Government purchasing preferences can accelerate the diffusion of products and services, potentially replacing the need for subsidies. Government procurement policies can specify particular product standards can foster their adoption by the private sector. Cities with green building policies targeting only municipal buildings had nearly twice as many private-sector green buildings by 2008 as did other cities of similar size, demographics, and environmental preferences. Closed for comment; 0 Comments.
- 17 Sep 2012
- Research & Ideas
Blue Skies, Distractions Arise: How Weather Affects Productivity
New studies show that workers are more productive on rainy days than on sunny ones. Does your office take advantage? Research by Francesca Gino and colleagues. Closed for comment; 0 Comments.
- 14 Jun 2012
- Working Paper Summaries
“Power from Sunshine”: A Business History of Solar Energy
In each generation, the concept of getting "power from sunshine" has attracted entrepreneurial visionaries who encountered a perennial problem: Solar energy was expensive compared to conventional fuels that were not priced to incorporate wider environmental costs. This paper by Geoffrey Jones and Loubna Bouamane provides a business history of solar energy between the nineteenth century and the present day. Its covers early attempts to develop solar energy, the use of passive solar in architecture before World War II, the subsequent growth of the modern photovoltaic (PV) industry, and alternative non-PV technologies such as parabolic collectors. As the authors argue, building viable business models proved crucially dependent on two factors: the prices of alternative conventional fuels and public policy. Key concepts include: The potential of solar power has attracted entrepreneurs for well over a century, but they have all struggled to build commercial businesses. The invention of PV cells in the 1950s, the "space age electronic marvel," transformed the potential of solar energy, but also vastly raised the financing stakes as the new technology was complicated and capital-expensive. Niche markets were found, especially among end-users such as satellites, pocket calculators and roof tops, but the widespread use of solar to generate electricity in large grid systems required government subsidies and other support, especially because the environmental costs of fossil fuels were not included in pricing. Subsidies and feed-in tariffs drove the growth of the solar industry over the last decade, especially in Europe and China, but they also distorted incentives and sometimes encouraged rent-seeking. Regular and unpredictable shifts in government policies, influenced by lobbying and shifts in the price of conventional energy sources, were especially damaging to renewable energy, with shifting Federal and state policies in the United States providing a prime example. Closed for comment; 0 Comments.
- 28 May 2012
- Research & Ideas
A Pragmatic Alternative for Creating a Corporate Social Responsibility Strategy
Many companies preach and practice corporate social responsibility, but their efforts often lack an overall strategy that dilutes their effectiveness. Professor "Kash" Rangan and colleagues offer a pragmatic solution. Closed for comment; 0 Comments.
- 18 Apr 2012
- Research & Ideas
HBS Cases: Who Controls Water?
In a recent field study seminar, Professor Forest L. Reinhardt discussed the case "Woolf Farming & Processing," which illustrates how access to water—a basic building block of agriculture—is affected by everything from complex government-mandated requirements to a 3-inch endangered bait fish. Open for comment; 0 Comments.
- 17 Apr 2012
- Working Paper Summaries
Technology Choice and Capacity Portfolios Under Emissions Regulation
What technologies should firms invest in when emissions are costly? With the European Union Emissions Trading Scheme in the EU, California's Assembly Bill 32, the Regional Greenhouse Gas Initiative in the northeastern US, and now Australia's Clean Energy Bill, more and more firms are having to ask themselves that question when planning their capacity portfolios. This paper uses formal theory to analyze firms' technology choice and capacity portfolios, both when emissions are taxed and when they are regulated under cap-and-trade. David Drake, Paul R. Kleindorfer, and Luk N. Van Wassenhove find that even when average emissions price is assumed to be equivalent to that under an emissions tax, firms are more profitable under cap-and-trade. The emissions price uncertainty under cap-and-trade that many argue will destroy value instead equips firms with a real option that increases value. In addition to comparing profits under emissions tax and cap-and-trade regimes, the authors identify a number of potential adverse outcomes that can arise as a consequence of emissions legislation that should be taken into consideration when formulating future climate policy. Key concepts include: Decreasing a dirty technology's emissions intensity (emissions generated per unit of production) can result in an increase in the emissions intensity of a firm's long-term capacity portfolio. Though a higher emissions tax rate is often assumed to spur greater investment in clean technology, the authors show that there are conditions under which a higher emissions tax rate leads to a decrease in clean technology investment. The share of clean technology in a firm's long-term capacity portfolio can increase in the market price of the goods that they produce, which has implications for sectors made more vulnerable to competition as a consequence of emissions regulation. Though many argue that an emissions tax would be more profitable for firms than a cap-and-trade regime due to the uncertainty in emissions price under cap-and-trade, the opposite is shown to be true. Even when average emissions price is assumed to be the same under both regimes, the uncertainty in emissions price under cap-and-trade equips firms with a real option that increases expected profits. Closed for comment; 0 Comments.
- 09 Apr 2012
- Research & Ideas
Who Sways the USDA on GMO Approvals?
Government agencies can be "captured" by the very companies or industries they regulate. Looking at how genetically altered food products are approved, Assistant Professor Shon R. Hiatt finds unexpected influencers on the US Department of Agriculture. Key concepts include: "Regulatory capture" describes the phenomenon whereby regulatory agencies tasked with serving the public instead end up advancing the interests of the companies they regulate. Traditional theories of capture such as lobbying and campaign contributions had little effect on whether the US Department of Agriculture approved any particular genetically altered agriculture product. What did seem to affect the approval process was the influence of third-party groups such as associations and even related regulatory agencies. Open for comment; 0 Comments.
- 26 Mar 2012
- Research & Ideas
What Neuroscience Tells Us About Consumer Desire
It's easy for businesses to keep track of what we buy, but harder to figure out why. Enter a nascent field called neuromarketing, which uses the tools of neuroscience to determine why we prefer some products over others. Uma R. Karmarkar explains how raw brain data is helping researchers unlock the mysteries of consumer choice. Closed for comment; 0 Comments.
- 08 Mar 2012
- Research & Ideas
Unplugged: What Happened to the Smart Grid?
Replacing the antiquated electrical system in the United States with a super-efficient smart grid always seemed a surefire opportunity for entrepreneurs. So what went wrong? asks Professor Rebecca M. Henderson. Closed for comment; 0 Comments.
Teaching Climate Change to Skeptics
The Business and Environment Initiative at Harvard Business School aims to shift the debate about climate change from a political discussion to a practical conversation about risk and reward. Closed for comment; 0 Comments.