Endogenous technology and tradable emission quotas
AbstractWe study an international climate agreement that assigns emission quotas to each participating country. Unlike the simplest models in the literature, we assume that abatement costs are affected by R&D activities undertaken in all firms in all countries, i.e. abatement technologies are endogenous. In line with the Kyoto agreement we assume that the international climate agreement does not include R&D policies. We show that for a second-best agreement with heterogeneous countries, marginal costs of abatement differ across countries. In other words, the second-best outcome cannot be achieved if emission quotas are tradable.
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Bibliographic InfoArticle provided by Elsevier in its journal Resource and Energy Economics.
Volume (Year): 30 (2008)
Issue (Month): 2 (May)
Contact details of provider:
Web page: http://www.elsevier.com/locate/inca/505569
Other versions of this item:
- Golombek, Rolf & Hoel, Michael, 2006. "Endogenous technology and tradable emission quotas," Memorandum 03/2006, Oslo University, Department of Economics.
- Michael Hoel & Rolf Golombek, 2006. "Endogenous Technology and Tradable Emission Quotas," Working Papers 2006.42, Fondazione Eni Enrico Mattei.
- H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
- O30 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - General
- Q20 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - General
- Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
- Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
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