Environmental R&amp;D in the Presence of an Eco-Industry

Nimubona, Alain-Désiré; Benchekroun, Hassan

doi:10.1007/s10666-014-9439-x

Cited by 15 publications

(5 citation statements)

References 45 publications

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“…Yet there is no internationally agreed-upon list for environmental goods or LCTs, though several lists have been developed for varying reasons (see Box 9.2). The use of different lists of environmental goods and of LCT products complicates the interpretation of analytical 2 For a discussion on decarbonizing power generation and consumption, see Bogdanov and others (2021); for the maritime sector, see Englert and Losos (2021); for steel, see Nimubona and Benchekroun (2021); for cement, see Habert and others (2020); for carbon capture-based aviation fuels, see Friedmann and others (2020). 3 Three of the four 1.5°C-aligned scenarios of the Intergovernmental Panel on Climate Change (IPCC) require large-scale negative emissions in the second half of this century; see IPCC (2018).…”

Section: Background and Literature Reviewmentioning

confidence: 99%

Data for a Greener World

2023

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Section: Background and Literature Reviewmentioning

confidence: 99%

Data for a Greener World

2023

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“…For a discussion of cleaner production technology, see Chiou andHu (2001), McDonald and, Puller (2006), and others. Furthermore, for the environmental R&D model in a vertical relationship between a polluting industry and an eco-industry, see Nimubona and Benchekroun (2015). 9 Requate (2005) is an excellent survey of related literature until the early 2000s.…”

Section: Endnotesmentioning

confidence: 99%

Strategic non‐use of the government's precommitment ability for emissions taxation: Environmental R&D formation in a Cournot duopoly

Ouchida

Goto

2021

Australian Economic Papers

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The primary focus of this paper is to examine the link between environmental R&D formation and the strategic use or non‐use of a government's ability to precommit to an emissions tax rate. The existing literature implicitly omits this important matter. This paper comprehensively evaluates various regulatory contexts separated by the timing of emissions taxation and by environmental R&D formations in a Cournot duopoly. The following three points are revealed. First, an equilibrium occurs in which the government does not strategically use its emissions tax rate precommitment ability to enhance social efficiency. Second, if the efficiency of environmental R&D costs is high and if environmental damage is serious, then the government should precommit to an emissions tax rate and allow for the cartelization of the two firms' environmental R&D. However, if the environmental R&D cost efficiency and environmental damage are both low, then the government should adopt a time‐consistent emissions tax and allow for the cartelization of the two firms' environmental R&D. Third, when the two firms can form an environmental research joint venture (ERJV), ERJV cartelization should be invariably allowed, even if the government is a strategic non‐user of its precommitment ability.

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“…They explain this distortion by the upstream degree of market power. Other papers add industrial organization arguments, like upstream entry (David, Nimubona, and Sinclair-Desgagné, 2011), merger in the eco-industry (Canton, David, and Sinclair-Desgagné, 2012) or R&D cooperation (Nimubona and Benchekroun, 2015).…”

Section: Background Literaturementioning

confidence: 99%

On Outsourced Abatement Services: Market Power and Efficient Regulation

Sans¹,

Schwartz²,

Stahn³

2019

Annals of Economics and Statistics

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In this paper, we consider competitive polluting firms that outsource their abatement activity to an upstream imperfect competitive eco-industry to comply with environmental regulation. In this case, we show that an usual environmental policy based on a Pigouvian tax or a pollution permit market reaches the first-best outcome. The main intuition is based on the idea that purchasing pollution reduction services instead of pollution abatement inputs modifies for each potential tax rate (or out of the equilibrium permit price) the nature of the arbitrage between pollution and abatement. This induces a demand for abatement services which is, at least partially, strongly elastic and therefore strongly reduces upstream market power. This argument is first illustrated with an upstream monopoly selling eco-services to a representative polluting firm under a usual Pigouvian tax. We then progressively extend the result to permit markets, heterogeneous downstream polluters and heterogeneous upstream Cournot competitors. JEL Codes: Q58, D43.

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Environmental R&D in the Presence of an Eco-Industry

Cited by 15 publications

References 45 publications

Data for a Greener World

Data for a Greener World

Strategic non‐use of the government's precommitment ability for emissions taxation: Environmental R&D formation in a Cournot duopoly

On Outsourced Abatement Services: Market Power and Efficient Regulation

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