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Sulfur dioxide allowances: Trading and technological progress

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  • Kumar, Surender
  • Managi, Shunsuke

Abstract

The US Clean Air Act Amendments introduce an emissions trading system to regulate SO2 emissions. This study finds that changes in SO2 emissions prices are related to innovations induced by these amendments. We find that electricity-generating plants are able to increase electricity output and reduce emissions of SO2 and NOx from 1995 to 2007 due to the introduction of the allowance trading system. However, compared to the approximate 8% per year of exogenous technological progress, the induced effect is relatively small, and the contribution of the induced effect to overall technological progress is about 1-2%.

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Bibliographic Info

Article provided by Elsevier in its journal Ecological Economics.

Volume (Year): 69 (2010)
Issue (Month): 3 (January)
Pages: 623-631

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Handle: RePEc:eee:ecolec:v:69:y:2010:i:3:p:623-631

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Web page: http://www.elsevier.com/locate/ecolecon

Related research

Keywords: Sulfur dioxide allowances trading Technological progress Environmental policy Distance function;

References

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Cited by:
  1. David Grover, 2012. "The “advancedness” of knowledge in pollutionsaving technological change with a qualitative application to SO2 cap and trade," Grantham Research Institute on Climate Change and the Environment Working Papers 100, Grantham Research Institute on Climate Change and the Environment.

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