Green Industrial Policy in Emerging Markets

Posted: 27 Oct 2017

See all articles by Ann E. Harrison

Ann E. Harrison

University of California, Berkeley; National Bureau of Economic Research (NBER)

Leslie A. Martin

University of Melbourne - Department of Economics

Shanthi Nataraj

RAND Corporation

Date Written: October 2017

Abstract

In this review, we discuss the challenges and opportunities associated with implementing green industrial policy in developing countries. These policies promote industries that produce green technologies and encourage traditional industries to produce goods and services in greener ways. We describe the experience in some emerging markets of voluntary programs to reduce emissions. Contrasting India and China's efforts to promote their solar photovoltaic industries, we also discuss the relative efficiency of promoting deployment versus promoting R&D. We also warn against expecting too much from policies that encourage renewables while governments simultaneously subsidize fossil fuels. The review discusses the potential of hybrid policies that combine command-and-control regulations targeted at the intensive margin for the largest polluters with market-based incentives that widen the reach of environmental regulations. We conclude with a discussion of how dismantling tariffs and facilitating foreign direct investment, ostensibly for nonenvironmental reasons, can have important environmental consequences.

Suggested Citation

Harrison, Ann E. and Martin, Leslie A. and Nataraj, Shanthi, Green Industrial Policy in Emerging Markets (October 2017). Annual Review of Resource Economics, Vol. 9, Issue 1, pp. 253-274, 2017. Available at SSRN: https://ssrn.com/abstract=3060468 or http://dx.doi.org/10.1146/annurev-resource-100516-053445

Ann E. Harrison (Contact Author)

University of California, Berkeley ( email )

Giannini Hall
Berkeley, CA 94720-3880
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Leslie A. Martin

University of Melbourne - Department of Economics ( email )

Melbourne, 3010
Australia

HOME PAGE: http://lesliemartin.org

Shanthi Nataraj

RAND Corporation ( email )

1776 Main Street
P.O. Box 2138
Santa Monica, CA 90407-2138
United States
310-393-0411 (Phone)

HOME PAGE: http://www.rand.org/

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
132
PlumX Metrics