Interactive Rulemaking and Corporate Innovation: Evidence from Environmental Regulations
Prof. Xiaoli Tian
Associate Professor
Georgetown University
Date: 4 December 2024 (Wednesday)
Time: 10:30 to 12:00
Venue: E22-G015
Host: Prof. Tingting QUE, Associate Professor in Finance
Abstract
We examine whether interactive rulemaking, specifically the Department of Energy’s “Process Rule,” influences corporate innovation. The Process Rule is implemented to transform the traditional rulemaking process to a more interactive process by increasing public input and consensus-building in developing Energy Conservation Standards. We find that firms subject to energy standards issued under this more interactive regime file significantly more patents in regulated products covered by the standards. This effect is absent when the energy standards are issued under the traditional regime. Focusing on the interactive regime, the effect of energy standards on innovation is more pronounced when the interactive process is likely more influential in setting the standards. Firms subject to energy standards file a significantly higher percentage of energy-related patents under the interactive regime. A placebo test indicates that the effect of interactive rulemaking on innovation is driven by corporate filers, but not by individuals or governmental agencies. Overall, these findings suggest that interactive rulemaking can encourage corporate innovation by fostering public participation.
Speaker
Prof. Tian’s research expertise includes corporate disclosure, earnings quality, governance and corporate taxation. She has published scholarly articles in top journals such as Journal of Accounting and Economics, The Accounting Review, Review of Accounting Studies, and Contemporary Accounting Research. Previous to Georgetown she has taught at The Ohio State University, University of Iowa, and University of Minnesota.
All are welcome!
