CO2-reducing innovations and outsourcing: Evidence from photovoltaics and green construction in North-East Italy

The paper investigates whether innovations entailing a perceived reduction of CO2 emissions are related to outsourcing. Some research hypotheses are put forward and tested on a sample of firms in two key 'green-industries', sustainable buildings and photovoltaics, in a regional context (North-East Italy) for which detailed survey-based information could be collected. An effect on CO2 reducing innovations is found for the externalisation of tangible activities only, as opposed to intangibles, whose outsourcing even decreases them. The results are robust in econometric terms, and suggest some new environmental implications of the standard 'make-or-buy' decisions of firms.