Organisational change and the productivity effects of green technology adoption

• Environmental innovation adoption for two cases: CO2 mitigation innovations and material- and resource-saving innovations.
• Tests for complementarities between environmental innovations and organisational change.
• Firm-level data covering heterogenous firms in manufacturing sectors.
• Productivity approach complementarities (OLS and IV regressions).

This study investigates induced productivity effects of firms introducing new environmental technologies. The literature on within-firm organisational change and productivity suggests that firms can achieve higher productivity gains from adopting new technologies if they adapt their organisational structures. Such complementarity effects may be of particular importance for the adoption of greenhouse gas (GHG) abatement technologies. The adoption of these technologies is often induced by public authorities to limit the social costs of climate change, whereas the private returns are much less obvious. This study finds empirical support for complementarity between green technology adoption (either CO2-reducing or resources and energy efficiency-enhancing technologies) and organisational change. While the sole adoption of green technologies is associated with lower productivity, the simultaneous implementation of green technologies and organisational innovations is not.