Pollution-reducing and resource-saving technological progress
by Dagmar Nelissen, Till Requate
International Journal of Agricultural Resources, Governance and Ecology (IJARGE), Vol. 6, No. 1, 2007

Abstract: We survey the theoretical literature on pollution-reducing and resource-saving technological progress, differentiating between microeconomic partial equilibrium models and endogenous growth models. The microeconomic models serve to investigate incentives to develop and adopt environmentally friendlier technologies under different policy tools, commitment strategies and market structures. Here price-based instruments usually outperform command and control policies. In most growth models a trade-off between growth rates and environmental quality occurs. Moreover, typically three market imperfections arise, market power for new products, R&D spillovers and pollution. These imperfections can be mitigated by subsidies on output and R&D effort, and taxes on emissions.

Online publication date: Wed, 24-Jan-2007

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