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Article in Journal ()

Market structure and technology diffusion incentives under emission taxes and emission reduction subsidies

Citation
de Vries F (2007) Market structure and technology diffusion incentives under emission taxes and emission reduction subsidies, Journal of Institutional and Theoretical Economics (JITE), 163 (2), pp. 256-268.

Abstract
This paper compares emission taxes with emission reduction subsidies regarding the incentives they create to enhance technology diffusion under imperfect competition. Firms can adopt a "dirty" technology or a "clean" abatement technology. If the clean and dirty products are perfect substitutes, and clean firms face a net absolute advantage over dirty firms, taxes provide the strongest incentive. This ranking is reversed if there is a distortion on output. Subsidies can neutralize this distortion because output supply is stimulated, which would normally be lower than optimal under perfect competition.

StatusPublished
Authorsde Vries Frans
Publication date06/2007
PublisherMohr Siebeck
ISSN 0932-4569
LanguageEnglish

Journal
Journal of Institutional and Theoretical Economics (jite): Volume 163, Issue 2 (JUN 2007)

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