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This study investigates how the eco-efficiency of government policy—continuously implementing innovation-friendly policy based on both environmental and economic considerations—affects the export performance of bioenergy technologies, using panel data from 16 countries during 1995–2012. Various heterogeneous panel framework tests are conducted. Our panel unit root and co-integration tests, which allow for cross-sectional dependence in the panel, show that the time series data on the eco-efficiency of public support, exports, and gross domestic product (GDP) are integrated and co-integrated. We set up a panel vector error correction model (VECM) to empirically test the casual relationship among the variables examined. The long-term parameters of the variables were calculated using dynamic ordinary lease squares (DOLS). Panel difference generalized method of moments (GMM) estimations were conducted to test the short-term relationship among the variables. The results of this study therefore show that the eco-efficiency of government policy positively influences export performance in the long run, but not in the short run. The presented findings also indicate that efficiently implemented government policy plays a crucial role in achieving environmentally sound and sustainable development, showing path dependence among the eco-efficiency of government policy, exports, and GDP. We finally suggest policy implications based on the results.

Eco-Efficiency of Government Policy and Exports in the Bioenergy Technology Market