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International Technology Transfer, Climate Change, and the Clean Development Mechanism

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  • David Popp
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    Abstract

    As the developed world begins efforts to limit its emissions of greenhouse gases, economic growth in developing countries is causing increased emissions from the developing world. Reducing these emissions while still enabling developing countries to grow requires the use of climate-friendly technologies in these countries. In most cases, these technologies are first created in high-income countries. Thus, the challenge for climate policy is to encourage the transfer of these climate-friendly technologies to the developing world. This article reviews the economic literature on environmental technology transfer and discusses the implications of this literature for climate policy, focusing on the Clean Development Mechanism (CDM). A key point is that technology diffusion is gradual. Early adoption of policy by developed countries leads to the development of new technologies that make it easier for developing countries to reduce pollution as well. Since clean technologies are first developed in the world's leading economies, international trade and foreign investments provide access to these technologies. Moreover, evidence suggests that some technologies, such as those enhancing energy efficiency, will diffuse to developing countries even without the aid of policy prescriptions, such as the CDM. This is important for assessing the potential emissions reductions of proposed CDM projects. Copyright 2011, Oxford University Press.

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    Bibliographic Info

    Article provided by Association of Environmental and Resource Economists in its journal Review of Environmental Economics and Policy.

    Volume (Year): 5 (2011)
    Issue (Month): 1 (Winter)
    Pages: 131-152

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    Handle: RePEc:oup:renvpo:v:5:y:2011:i:1:p:131-152

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    Cited by:
    1. Aparna Sawhney & Matthew E. Kahn, 2011. "Understanding Cross-National Trends in High-Tech Renewable Power Equipment Exports to the United States," NBER Working Papers 17217, National Bureau of Economic Research, Inc.
    2. Richard G. Newell & William A. Pizer & Daniel Raimi, 2013. "Carbon Markets 15 Years after Kyoto: Lessons Learned, New Challenges," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 27(1), pages 123-46, Winter.
    3. Wei Jin & ZhongXiang Zhang, 2014. "Explaining the Slow Pace of Energy Technological Innovation: Why Market Conditions Matter?," Working Papers, Fondazione Eni Enrico Mattei 2014.18, Fondazione Eni Enrico Mattei.
    4. Suzi Kerr & Adam Millard-Ball, 2012. "Cooperation to Reduce Developing Country Emissions," Working Papers, Motu Economic and Public Policy Research 12_03, Motu Economic and Public Policy Research.
    5. Antoine Dechezleprêtre & Richard Perkins & Eric Neumayer, 2012. "Regulatory Distance and the Transfer of New Environmentally Sound Technologies: Evidence from the Automobile Sector," Working Papers, Fondazione Eni Enrico Mattei 2012.33, Fondazione Eni Enrico Mattei.
    6. Wei Jin & ZhongXiang Zhang, 2014. "On the Mechanism of International Technology Diffusion for Energy Productivity Growth," Working Papers, Fondazione Eni Enrico Mattei 2014.40, Fondazione Eni Enrico Mattei.
    7. Pfeiffer, Birte & Mulder, Peter, 2013. "Explaining the diffusion of renewable energy technology in developing countries," Energy Economics, Elsevier, Elsevier, vol. 40(C), pages 285-296.
    8. Marius Ley & Tobias Stucki & Martin Wörter, 2013. "The Impact of Energy Prices on Green Innovation," KOF Working papers, KOF Swiss Economic Institute, ETH Zurich 13-340, KOF Swiss Economic Institute, ETH Zurich.
    9. Wei Jin, 2012. "International Knowledge Spillover and Technology Externality: Why Multilateral R&D Coordination Matters for Global Climate Governance," CAMA Working Papers, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University 2012-53, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    10. Patrick Bayer & Johannes Urpelainen, 2013. "External sources of clean technology: Evidence from the Clean Development Mechanism," The Review of International Organizations, Springer, Springer, vol. 8(1), pages 81-109, March.
    11. Victor, David, 2013. "Foreign aid for capacity-building to address climate change: Insights and applications," Working Paper Series, World Institute for Development Economic Research (UNU-WIDER) UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
    12. Wei Jin, 2012. "Can China Harness Globalization to Reap Carbon Savings? Modeling International Technology Diffusion in a Multi-region Framework," CAMA Working Papers, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University 2012-52, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.

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