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Compliance Technology and Self-enforcing Agreements

Russo, Alessia; Harstad, Bård Gjul; Lancia, Francesco
Journal article, Peer reviewed
Accepted version
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Locked until 17. Jaunar 2021, due to publishers policy (606.8Kb)
URI
http://hdl.handle.net/11250/2581388
Date
2019
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  • Publikasjoner fra CRIStin - BI [633]
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Original version
Journal of the European Economic Association. 2019  
Abstract
This paper analyzes a game in which countries repeatedly make emission and technology investment decisions. We derive the best equilibrium, that is, the Pareto-optimal subgame-perfect equilibrium, when countries are insufficiently patient for folk theorems to be relevant. Relative to the first best, the best equilibrium requires countries to overinvest in technologies that are green, that is, strategic substitutes for polluting, but to underinvest in adaptation and brown technologies, that is, strategic complements to polluting. Technological transfers and spillovers might discourage investments but can be necessary to motivate compliance with emissions when countries are heterogeneous
Publisher
Oxford
Journal
Journal of the European Economic Association

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