Absorptive capacity and energy efficiency in manufacturing firms – An empirical analysis in Norway

Abstract

Increased energy efficiency (EE) in manufacturing firms is important for confronting climate challenges. However, the information barrier is considered a major restriction on EE innovation. Building on the theory of absorptive capacity and the current EE literature, we argue that this barrier relates to firms' ability to assimilate and exploit information. Thus, this study's objective is to analyse firms' knowledge characteristics as determinants of EE innovation. We perform logit regressions using a Norwegian panel dataset for the period 2010–2014. The results are based on statistical correlations between data points that have potential uncertainties. Still, the main implications from our study are that prior knowledge, in terms of higher educated workforce, knowledge development, in terms of R&D capacity, and external knowledge cooperation, such as cooperation with universities and competitors, increase firms' pursuit of EE innovation. Further, the results also imply that there is an interaction effect between higher educated workforce and collaboration with universities. These results suggest that policy makers should consider firms' ability to assimilate and exploit information. This can be done by providing information according to firms' needs and absorptive capacity, and offering possibilities for firms to increase this capacity.