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Technology-forcing through environmental regulation

Nentjes A, de Vries F & Wiersma D (2007) Technology-forcing through environmental regulation, European Journal of Political Economy, 23 (4), pp. 903-916.

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.

Innovation; Technology-forcing; Standards; Environmental regulation

AuthorsNentjes Andries, de Vries Frans, Wiersma Doede
Publication date12/2007
Publication date online06/04/2007
ISSN 0176-2680

European Journal of Political Economy: Volume 23, Issue 4 (DEC 2007)

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