Technology Treaties and Climate Change

CER-ETH – Center of Economic Research at ETH Zurich, Working Paper 17/268, March 2017

79 Pages Posted: 11 Mar 2017 Last revised: 25 Mar 2017

See all articles by Hans Gersbach

Hans Gersbach

ETH Zurich - CER-ETH -Center of Economic Reseaarch; IZA Institute of Labor Economics; CESifo (Center for Economic Studies and Ifo Institute); Centre for Economic Policy Research (CEPR)

Marie-Catherine Riekhof

ETH Zürich - CER-ETH - Center of Economic Research at ETH Zurich; University of Kiel

Date Written: March 10, 2017

Abstract

We introduce an international technology treaty that couples the funding of research for a more advanced abatement technology with an international emissions permit market. Under the treaty, each country decides on the amount of permits for its domestic industries, but a fraction of these permits is auctioned on the permit market, and the revenues are used to scale up license revenues for the innovators of abatement technologies. We discuss the conditions under which such a technology treaty can slow down climate change through technological innovations and whether it creates complementary incentives for countries to tighten permit issuance. Finally, we discuss how participation in Tech Treaties can be fostered and how such treaties might be implemented.

Keywords: Climate change mitigation, Technology promotion, International permit markets, International treaty, Externalities

JEL Classification: H23, Q54, O31

Suggested Citation

Gersbach, Hans and Riekhof, Marie-Catherine, Technology Treaties and Climate Change (March 10, 2017). CER-ETH – Center of Economic Research at ETH Zurich, Working Paper 17/268, March 2017 . Available at SSRN: https://ssrn.com/abstract=2930924 or http://dx.doi.org/10.2139/ssrn.2930924

Hans Gersbach

ETH Zurich - CER-ETH -Center of Economic Reseaarch ( email )

Zürichbergstrasse 18
Zurich, 8092
Switzerland
+41 44 632 82 80 (Phone)
+41 44 632 18 30 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Marie-Catherine Riekhof (Contact Author)

ETH Zürich - CER-ETH - Center of Economic Research at ETH Zurich ( email )

Zürichbergstrasse 18
Zurich, 8092
Switzerland

University of Kiel

Olshausenstr. 40
D-24118 Kiel, Schleswig-Holstein 24118
Germany

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