Article ID Journal Published Year Pages File Type
5068356 European Journal of Political Economy 2007 14 Pages PDF
Abstract
This paper analyzes the demand characteristics of innovation in pollution abatement and the interaction between a regulator and a polluter under a technology-forcing policy. Important demand-driven determinants of innovation in pollution control are examined, such as uncertainties surrounding unexplored technologies, the length of the compliance period and the maximum abatement costs the regulator is willing to accept. We derive the formal condition that the regulator balances the marginal utility of emissions reduction against the marginal disutilities of a longer compliance time and the increased uncertainty about the feasibility of a more stringent standard.
Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
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