On Clean Technology Diffusion Mechanisms

Developing countries argue that because of their historical responsibility, developed countries should be the ones to bear the costs of climate change mitigation. This paper revisits this argument throughout the analysis of clean technology diffusion between developed and developing countries in the power generation sector. Our model shows that developed countries could decide to develop clean technologies on their own and still achieve substantial results in climate change mitigation. However, this is so if both the clean innovation rate in developed countries is high enough and developing countries own adequate capacities to absorb these innovations.