The More Climate Skeptics There Are, the Fewer Climate Entrepreneurs
Harvard Business Review
MARCH 16, 2017
But how does the presence of climate skeptics affect the market for climate-related innovation? A drug company must incur a large fixed cost to do the basic research, so it has strong incentives to predict what the demand for the drug will be if its research succeeds. The small market size would lead the company to not invest in baldness medication. The higher the market demand for a drug, the greater the probability that at least one drug maker conducts basic research.