The Clean Development Mechanism and Technology Transfer: A Firm Level Evidence from India

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    Abstract

    This study assesses the impact of the Clean Development Mechanism (CDM) on the transfer of clean technology in India. The reason this study is unique is because firstly, it adopts an outcome-oriented approach to define ‘technology transfer’, which means that technology transfer occurs if firms are able to upgrade their ‘dynamic capabilities’. It uses three indicators of firms’ dynamic capabilities: R&D expenditures to sales ratio, fuel consumption to sales ratio and total factor productivity growth. Secondly, it moves away from the analysis of technology transfer claims made in either Project Development Documents or primary surveys to using actual information on firms’ performance for the analysis. The empirical analysis is based on a difference-in-difference design. It draws on the balance sheet data of 612 firms from India between 2001 and 2012 from the PROWESS database. The results reveal that CDM has the potential of laying a foundation for capability building in developing countries but in its current form, it is not effective.
    Original languageEnglish
    JournalInnovation and Development
    Volume8
    Issue number2
    Pages (from-to)249-269
    Number of pages21
    ISSN2157-930X
    DOIs
    Publication statusPublished - Oct 2018

    Bibliographical note

    Published online: 21. Aug 2017

    Keywords

    • CDM
    • Dynamic capability
    • India
    • R&D
    • Fuel efficiency
    • Total factor productivity

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