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The Climate Policy Hold-Up: Green Technologies, Intellectual Property Rights, and the Abatement Incentives of International Agreements

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  • Timo Goeschl
  • Grischa Perino

Abstract

The success of global climate policies over the coming decades depends on the diffusion of 'green' technologies. This requires that international environmental agreements (IEAs) and trade-related intellectual property rights (TRIPs) interact productively.Using a simple and tractable model, we highlight the strategic reduction in abatement commitments on account of a hold-up effect. In anticipation of rent extraction by the innovator signatories might abate less than non-signatories turning the IEA 'brown'. Self-enforcing IEAs have fewer signatories and diffusion can reduce global abatement under TRIPs. Countries hosting patent holders extract rents from TRIPs, but may be better off without them.
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  • Timo Goeschl & Grischa Perino, 2017. "The Climate Policy Hold-Up: Green Technologies, Intellectual Property Rights, and the Abatement Incentives of International Agreements," Scandinavian Journal of Economics, Wiley Blackwell, vol. 119(3), pages 709-732, July.
  • Handle: RePEc:bla:scandj:v:119:y:2017:i:3:p:709-732
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    References listed on IDEAS

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    Cited by:

    1. Hans Gersbach & Marie-Catherine Riekhof, 2017. "Technology Treaties and Climate Change," CER-ETH Economics working paper series 17/268, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
    2. Heyen, Daniel, 2016. "Strategic conflicts on the horizon: R&D incentives for environmental technologies," LSE Research Online Documents on Economics 68104, London School of Economics and Political Science, LSE Library.
    3. Matthieu Glachant & Julie Ing & Jean Philippe Nicolai, 2017. "The Incentives for North-South Transfer of Climate-Mitigation Technologies with Trade in Polluting Goods," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 66(3), pages 435-456, March.
    4. Julia Blasch & Nina Boogen & Nilkanth Kumar & Massimo Filippini, 2017. "The role of energy and investment literacy for residential electricity demand and end-use efficiency," CER-ETH Economics working paper series 17/269, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
    5. Daniel Heyen, 2016. "Strategic Conflicts On The Horizon: R&D Incentives For Environmental Technologies," Climate Change Economics (CCE), World Scientific Publishing Co. Pte. Ltd., vol. 7(04), pages 1-27, November.

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