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The Role of Product and Process Innovation in CGE Models of Environmental Policy

Listed author(s):
  • Claudio Baccianti
  • Andreas Löschel

In the last two decades, large scale CGE models used for environmental policy assessment underwent an important upgrade to integrate endogenous technological progress. Nevertheless, several complexities of innovation are still neglected even if they are of primary interest for policymakers. This paper provides a review of the current state of the art in the CGE modelling literature through a special lens. We discuss how existing models deal with different types of innovation (i.e. product and process innovation) and how differences in innovation activities influence modelling results. We also emphasise the implications of product innovation in a multisector framework, which has received little attention in the literature.

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Paper provided by WWWforEurope in its series WWWforEurope Working Papers series with number 68.

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Length: 41
Date of creation: Oct 2014
Publication status: published
Handle: RePEc:feu:wfewop:y:2014:m:10:d:0:i:68
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Order Information: Postal: WWWforEurope Project Office Austrian Institute of Economic Research Arsenal Objekt 20 A-1030 Vienna
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