We would like to invite all enthusiasts and finance researchers to the February 2024 Kozminski University Finance Research Seminar - Adapting to Change: Environmental Investment Tax Credit Elimination and Firms' Strategies
When? Wednesday, 27 March 2024, 5:15 PM (CET)
At Kozminski University - D218 or online via Microsoft Teams (MS Teams link will be sent following registration below)
ABSTRACT:
This empirical paper examines the adaptive strategies of manufacturing firms in Spain between 2010-2020 following the elimination of environmental investment (EI) tax credit in 2015. Focusing on the shift in green technology investments, e.g. cleaner production technologies as well as end-of-pipe, we find that firms reliant on tax credits reduced superior cleaner production technologies but increased environmental R&D. No significant changes were observed for inferior end-of-pipe. Small firms were disproportionately affected with regards to process integrated technologies. Mitigating strategies include hiring green employees, utilizing subsidies, and introducing low-level environmental taxes. Our findings underscore the enduring negative impacts of EI tax credit elimination and advocate for careful consideration in green technology policy changes.