3561 Environmental technology exports: Analyzing Swedish government and firms' initiatives

Wisdom Kanda , Department of Management and Engineering, Linköping University, Linköping, Sweden
Santiago Mejía-Dugand , Department of Management and Engineering, Linköping University, Linköping, Sweden
Olof Hjelm , Department of Management and Engineering, Linköping University, Linköping, Sweden
Full Papers
  • Kanda et al.- Full revised paper.pdf (98.9 kB)
  • Justification of the paper:

    In recent times, the Swedish government has designed a number of strategies to promote environmental technology export. This, to some extent, is a response to the transition towards global sustainability. In particular, many industries in emerging markets lack the technological resources to address the challenges of a cleaner production. This represents an opportunity for the Swedish environmental technology sector, given its vast experience and technological development. However, Sweden has not enjoyed much export success compared to other top environmental technology innovators.

    Purpose:

    This paper analyses the effectiveness of governmental initiatives to promote environmental technology export among Swedish firms. In doing so, it addresses the “willingness” of Swedish environmental technology firms to export, whether these governmental initiatives actually reach the targeted firms and if any tangible export business could be linked to the participation in any such governmental support.

    Theoretical framework:

    The economic justification for government intervention in export promotion is grounded on the theories of externalities and information asymmetry among market players. Private firms are hesitant to solely engage in foreign market information gathering and incur the market research cost knowing very well benefits could potentially spill over to competitors. For justifying our focus on information availability on the internet and the quality of such information as a signal of the “willingness” to export we use marketing and internationalisation theories as support.

    Results:

    Our hypothesis is that Swedish environmental technology providers are not completely prepared to properly address the fact that it is frequently the potential customer who establishes the connection between local market needs and some foreign-sourced product. Although many companies may have their own web pages, many are not available in other languages (apart from Swedish) or do not have clear contact information. This would give the government an important signal regarding the need to focus on developing internal capabilities before launching ambitious export promotion plans. A second hypothesis is that big companies have more accessibility to resources and thus have better performing information on the internet. This would be an interesting result, since the Swedish environmental technology sector is dominated by micro, small or medium-sized.

    Conclusions:

    Some governmental environmental technology export promotion initiatives might have failed because of several reasons. For example, for being expensive, lumped together with general export promotion initiatives and because of the lack of coordination and clarity, which confuses small and medium sized companies when choosing the best-fitting program.

    In addition to vital market information provision by governmental agencies, it is important to help companies improve their ability to connect with potential customers in a direct way (e.g., through the internet) and strengthen by themselves the kind of ties needed in order to enter, e.g., psychically distant markets.

    Finally, the fact that the government launches an ambitious export promotion plan does not necessarily mean that companies (especially micro and small-sized) are willing to enter such process, as they may feel comfortable within their current market and/or underestimate their export potential.