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Technological choice under environmentalists’ participation in Emissions Trading Systems

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  • Elias Asproudis
  • Maria José Gil-Moltó

    ()

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.

Suggested Citation

  • Elias Asproudis & Maria José Gil-Moltó, 2009. "Technological choice under environmentalists’ participation in Emissions Trading Systems," Discussion Papers in Economics 09/9, Department of Economics, University of Leicester.
  • Handle: RePEc:lec:leecon:09/9
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    File URL: http://www.le.ac.uk/economics/research/repec/lec/leecon/dp09-9.pdf
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    References listed on IDEAS

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    1. Christoph Böhringer & Ulf Moslener & Bodo Sturm, 2007. "Hot air for sale: a quantitative assessment of Russia’s near-term climate policy options," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 38(4), pages 545-572, December.
    2. Bohringer, Christoph & Vogt, Carsten, 2004. "The dismantling of a breakthrough: the Kyoto Protocol as symbolic policy," European Journal of Political Economy, Elsevier, vol. 20(3), pages 597-617, September.
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    Cited by:

    1. Maria J. Gil-Molto & Bouwe Dijkstra, 2011. "Strictness of Environmental Policy and Investment in Abatement," Discussion Papers in Economics 11/35, Department of Economics, University of Leicester.
    2. Asproudis, Elias, 2011. "Trade union structure with environmental concern and firms' technological choice," MPRA Paper 28767, University Library of Munich, Germany.

    More about this item

    Keywords

    ETS; Technology Choice; Induced Technological Change; Impure Altruism;

    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, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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