Technology diffusion, abatement cost, and transboundary pollution

Arbeitspapier

This paper studies countries' incentives to develop advanced pollution abatement technology when technology may spillover across countries and pollution abatement is a global public good. We are motivated in part by the problem of global warming: a solution to this involves providing a global public good, and will surely require the development and implementation of new technologies. We show that at the Nash equilibrium of a simultaneous-move game with R&D investment and emission abatement, whether the free rider effect prevails and under-investment and excess emissions occur depends on the degree of technology spillovers and the effect of R&D on the marginal abatement costs. There are cases in which, contrary to conventional wisdom, Nash equilibrium investments in emissions reductions exceed the first-best case.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Nota di Lavoro ; No. 96.2008

Classification and Topics

• Classification: Wirtschaft ; Environmental Economics: General ; International Fiscal Issues; International Public Goods ; Analysis of Collective Decision-Making: General
• Subject: International Environmental Agreement ; Pollution Abatement Costs ; Endogenous Technological Change

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Tarui, Nori ; Heal, Geoffrey
• Event: Veröffentlichung
• (who): Fondazione Eni Enrico Mattei (FEEM)
• (where): Milano
• (when): 2008

Further information

• Handle: http://hdl.handle.net/10419/53382
• Last update: 10.03.2025, 11:42 AM CET