ABSTRACT
This chapter discusses environmental research and development (R&D) in the context of corporate social responsibility (CSR) and the analysis of sources of competitive advantage in a corporation's value chain. It focuses on a special part of the general task of value chain management, and to place the focused discussion in the general context. The chapter explains profitable investment can be found when public policy or other forces have value-shifting or probability-shifting impacts on environmental R&D investments. It defines environmental R&D, uses original data from the economic history of the mid-1990s to document its presence, and discusses it in the context of corporate social responsibility and sustainable value-chain management. The chapter has used theory about R&D investment along with evidence taken from the economic history of the 1990s to explain that responsible public policy can create incentives for profitable environmental R&D that is in the social interest.
