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Technological choice under environmentalists’ participation in Emissions Trading Systems

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Author Info
Elias Asproudis
Maria José Gil-Moltó ()

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Abstract

We model competition in an emissions trading system (ETS) as a game between two firms and environmental group. In a previous stage, firms endogenously choose their manufacturing technologies. Our results show that there is an inverted U-shape relationship between how polluting the chosen technology is and the degree of the environmentalists' impure altruism. Firms choose a less polluting technology in the presence of the environmentalists than in their absence only if they are characterised by intermediate degrees of impure altruism.

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File URL: http://www.le.ac.uk/economics/research/RePEc/lec/leecon/dp09-9.pdf
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Publisher Info
Paper provided by Department of Economics, University of Leicester in its series Discussion Papers in Economics with number 09/9.

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Date of creation: Apr 2009
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Handle: RePEc:lec:leecon:09/9

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Related research
Keywords: ETS; Technology Choice; Induced Technological Change; Impure Altruism;

Find related papers by JEL classification:
L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
Q30 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - General
O31 - Economic Development, Technological Change, and Growth - - Technological Change - - - Innovation and Invention: Processes and Incentives

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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    Other versions:
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    Other versions:
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  14. Boyd, John III & Conley, John P., 1997. "Fundamental Nonconvexities in Arrovian Markets and a Coasian Solution to the Problem of Externalities," Journal of Economic Theory, Elsevier, vol. 72(2), pages 388-407, February. [Downloadable!] (restricted)
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    Other versions:
  18. Stevens, Brandt & Rose, Adam, 2002. "A Dynamic Analysis of the Marketable Permits Approach to Global Warming Policy: A Comparison of Spatial and Temporal Flexibility," Journal of Environmental Economics and Management, Elsevier, vol. 44(1), pages 45-69, July. [Downloadable!] (restricted)
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