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Effects of Technology Transfers on the Provision of Public Goods

  • Tae-Yeoun Lee

    ()

In this paper, we examine the viability ofcooperative policies oriented to the resolution oftransboundary pollution problems using the theory ofprivate provision of public goods in a two-countrymodel. We analyze the effects on economic welfare ofvoluntary technological transfers oriented to reducingthe emission of pollutants. Our analysis shows that when the atmosphere istaken as a pure public goods, ``a strong paradox'' emerges:the advanced country, in spite of the transfer, seesits economic welfare improved while the developingcountry sees it worsen. Moreover, if both a technicaland an income transfer occur, this paradox mightnot be solved. Furthermore, ``a paradoxicalimprovement'' occurs when the advanced country does nottake any policy towards the environment but thedeveloping country does: an improvement in the levelof technology in the developing country allows for anexpansion of the level of utility in both countries.On the other hand, in the case where the atmosphere istaken as an impure public goods, when both countriespursue an abatement policy, the transfer of technologyleads to an improvement in welfare in bothcountries. Copyright Kluwer Academic Publishers 2001

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

Volume (Year): 18 (2001)
Issue (Month): 2 (February)
Pages: 193-218

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Handle: RePEc:kap:enreec:v:18:y:2001:i:2:p:193-218
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  1. Murdoch, James C & Sandler, Todd & Sargent, Keith, 1997. "A Tale of Two Collectives: Sulphur versus Nitrogen Oxides Emission Reduction in Europe," Economica, London School of Economics and Political Science, vol. 64(254), pages 281-301, May.
  2. Cornes, Richard & Sandler, Todd, 1994. "The comparative static properties of the impure public good model," Journal of Public Economics, Elsevier, vol. 54(3), pages 403-421, July.
  3. McGuire, M.C. & Andreoni, J., 1991. "Identifying the Free Riders: A Simple Algorithm for Determining who will Contribute to Public Good," Papers 90-92-03, California Irvine - School of Social Sciences.
  4. Andreoni, James, 1988. "Privately provided public goods in a large economy: The limits of altruism," Journal of Public Economics, Elsevier, vol. 35(1), pages 57-73, February.
  5. Tahvonen Olli & Kaitala Veijo & Pohjola Matti, 1993. "A Finnish - Soviet Acid Rain Game: Noncooperative Equilibria, Cost Efficiency, and Sulfur Agreements," Journal of Environmental Economics and Management, Elsevier, vol. 24(1), pages 87-100, January.
  6. Cesar, Herman S. J., 1993. "International cooperation and technology transfers in the case of the Greenhouse Effect," Structural Change and Economic Dynamics, Elsevier, vol. 4(1), pages 163-181, June.
  7. Buchholz, Wolfgang & Konrad, Kai A., 1995. "Strategic transfers and private provision of public goods," Journal of Public Economics, Elsevier, vol. 57(3), pages 489-505, July.
  8. John Stranlund, 1996. "On the strategic potential of technological aid in international environmental relations," Journal of Economics, Springer, vol. 64(1), pages 1-22, February.
  9. Wolfgang Buchholz & Kai Konrad, 1994. "Global environmental problems and the strategic choice of technology," Journal of Economics, Springer, vol. 60(3), pages 299-321, October.
  10. Copeland, Brian R & Taylor, M Scott, 1994. "North-South Trade and the Environment," The Quarterly Journal of Economics, MIT Press, vol. 109(3), pages 755-87, August.
  11. Marjit, Sugata, 1990. "On a non-cooperative theory of technology transfer," Economics Letters, Elsevier, vol. 33(3), pages 293-298, July.
  12. Niho, Yoshio, 1996. "Effects of an international income transfer on the global environmental quality," Japan and the World Economy, Elsevier, vol. 8(4), pages 401-410, December.
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