Technology Transfers and the Clean Development Mechanism in a North-South General Equilibrium Model

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Technology Transfers and the Clean Development Mechanism in a North-South General Equilibrium Model SummaryThis paper analyzes the potential welfare gains of introducing a technology transfer from Annex I to non-Annex I in order to mitigate greenhouse gas emissions. Our analysis is based on a numerical general equilibrium model for a world economy comprising two regions, North (Annex I) and South (non-Annex I). As our model allows for labor mobility between the formal and informal sectors in the South, we are also able to capture additional aspects of how the transfer influences the Southern economy. In a cooperative equilibrium, a technology transfer from the North to the South is clearly desirable from the perspective of a 'global social planner', since the welfare gain for the South outweighs the welfare loss for the North. However, if the regions do not cooperate, then the incentives to introduce the technology transfer appear to be relatively weak from the perspective of the North; at least if we allow for Southern abatement in the pre-transfer Nash equilibrium. Finally, by adding the emission reductions associated with the Kyoto agreement to an otherwise uncontrolled market economy, the technology transfer leads to higher welfare in both regions.

A Review of Carbon Market Policies and Research

“…Both the case studies (Forsyth, 1999, Duic et al, 2003, Forsyth, 2005, the partial equilibrium (Kemfert, 2003), the general equilibrium (Sahlén and Aronsson, 2006), and the strategic approaches (Matsuhashi et al, 1999, Millock, 2002 suggest that there is no one policy that addresses similarly the issues countries face, but rather, each country or partnership that collaborates in the CDM setting needs a specific solution to allow technology development and its transfer. Finally, an econometric study of the reported technology transfer by project types and countries suggests also a more microscopic analysis and understanding of the differences between determinants of technology transfer (Haites et al, 2006).…”

“…Using a partial equilibrium model, Kemfert (2003) shows that trade barriers, would not only damage the economy, but could also deter investments in climate friendly technologies. Using a general equilibrium model, Sahlén and Aronsson (2006) add also labor barriers into the market of factors of production to account for north economies (capital intensive) and south economies (labor intensive). The effects of trade barriers (including labor) imply that for a CDM setting with allowed flows of factors of production -no borders, a technology transfer from the North to the South is clearly desirable from the perspective of a "global social planner," since the welfare gain for the South outweighs the welfare loss for the North.…”

Carbon Markets, Institutions, Policies, And Research

“…indirectly related to technology development, adjustment and transfer. Both the case studies (Forsyth, 1999;Duic et al, 2003;Forsyth, 2005;), the partial equilibrium (Kemfert, 2003), the general equilibrium (Sahlén and Aronsson, 2006), and the strategic approaches (Matsuhashi, Chang and Ishitani, 1999;Millock, 2002) suggest that there is no one policy that addresses similarly the issues countries face, but rather, each country or partnership that collaborates in the CDM setting needs a specific solution to allow technology and its transfer. Finally, an econometric study of the reported technology transfer by project types and countries suggests also a more microscopic analysis and understanding of the differences between determinants of technology transfer (Haites, Duan and Seres, 2006).…”

“…Using a partial equilibrium model, Kemfert (2003) shows that trade barriers, would not only damage the economy, but could also deter investments in climate friendly technologies. Using a general equilibrium model, Sahlén and Aronsson (2006) add also labor barriers into the market of factors of production to account for north economies (capital intensive) and south economies (labor intensive).…”