Technology Treaties and Climate Change

75 Pages Posted: 7 Oct 2019

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

Multiple version iconThere are 2 versions of this paper

Date Written: October 2019

Abstract

We introduce an international technology treaty ("Tech Treaty") that couples the funding of research for a more advanced abatement technology with an international emissions permit market. While each country decides on domestic permit issuance, a fraction of these permits is auctioned by an international agency. Auction revenues scale up license revenues for the innovators of abatement technologies. We show that such a treaty increases innovations and decreases emissions under plausible conditions compared to an emissions trading system without additional technology agreement. Finally, we discuss how a Tech Treaty may inspire next steps in existing technology programs.

Keywords: Climate Change Mitigation - Technology Promotion - R&D - International Emissions Permit Markets - International Treaty - Externalities

JEL Classification: H23, O31, Q54

Suggested Citation

Gersbach, Hans and Riekhof, Marie-Catherine, Technology Treaties and Climate Change (October 2019). CEPR Discussion Paper No. DP14033. Available at SSRN: https://ssrn.com/abstract=3464578

Hans Gersbach (Contact Author)

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

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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