Economic and Environmental Effectiveness of a Technology-Based Climate Protocol

44 Pages Posted: 24 May 2004 Last revised: 14 Jul 2014

See all articles by Carlo Carraro

Carlo Carraro

Fondazione Eni Enrico Mattei (FEEM); Ca' Foscari University of Venice; CMCC - Euro Mediterranean Centre for Climate Change (Climate Policy Division); IPCC; Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute); Centre for European Policy Studies, Brussels; Green Growth Knowledge Platform; International Center for Climate Governance

Barbara K. Buchner

International Energy Agency; Fondazione Eni Enrico Mattei (FEEM)

Date Written: April 1, 2004

Abstract

The present stalemate in climate negotiations has led policy analysts and economists to explore the possible emergence of alternative climate regimes. This paper explores the idea of replacing international cooperation on greenhouse gas emission control with international cooperation on climate-related technological innovation and diffusion. This idea - recently proposed among others by Barrett (2001) and Benedick (2001) - is based on the insight that incentives to free-ride are much smaller in the case of technological cooperation than in the case of cooperation on emission control. This paper provides a first applied game theory analysis of a technology-based climate protocol by assessing: (i) the self-enforcingness (namely, the absence of incentives to free ride) of the coalition that would form when countries negotiate on climate-related technological cooperation; (ii) the environmental effectiveness of a technology-based climate protocol. The analysis is carried out by using a model in which endogenous and induced technical change are explicitly modelled and in which international technological spillovers are also quantified. The results of our analysis partly support Barrett's and Benedick's conjecture. On the one hand, a self-enforcing agreement is more likely to emerge when countries cooperate on environmental technological innovation and diffusion than when they cooperate on emission abatement. However, technological cooperation - without any commitment to emission control - may not lead to a sufficient abatement of greenhouse gas concentrations.

Keywords: Agreements, Climate, Incentives, Technological change, Policy

JEL Classification: C7, H0, H4, O3

Suggested Citation

Carraro, Carlo and Buchner, Barbara K., Economic and Environmental Effectiveness of a Technology-Based Climate Protocol (April 1, 2004). University Ca' Foscari of Venice, Dept. of Economics Research Paper Series Forthcoming, FEEM Working Paper No. 61.04, Available at SSRN: https://ssrn.com/abstract=544883 or http://dx.doi.org/10.2139/ssrn.544883

Carlo Carraro (Contact Author)

Fondazione Eni Enrico Mattei (FEEM) ( email )

Isola di San Giorgio Maggiore 8
Venezia, 30124
Italy
+39 04 12700460 (Phone)
+39 04 12700412 (Fax)

Ca' Foscari University of Venice ( email )

Cannaregio 873
Venice, 30121
Italy
+39 04 1234 9166 (Phone)
+39 04 1234 9176 (Fax)

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

CMCC - Euro Mediterranean Centre for Climate Change (Climate Policy Division) ( email )

Via Augusto Imperatore 16
Lecce, 73100
Italy
+39 0832 288650 (Phone)
+39 0832 277603 (Fax)

IPCC ( email )

C/O World Meteorological Organization
7bis Avenue de la Paix
Geneva, CH-1211
Switzerland
+41-22-730-8208/54/84 (Phone)
+41-22-730-8025/13 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Centre for European Policy Studies, Brussels

1 Place du Congres
B-1000 Brussels, 1000
Belgium
+32 2 229 3911 (Phone)
+32 2 219 4151 (Fax)

Green Growth Knowledge Platform ( email )

International Environment House
11-13 chemin des Anemones
Geneva, 1219
Switzerland

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

International Center for Climate Governance ( email )

Island of San Giorgio Maggiore 8
Venice, I-30124
Italy

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

Barbara K. Buchner

International Energy Agency ( email )

9 rue de la Fédération
Paris
France
+33(0)140576687 (Phone)
+33(0)140576739 (Fax)

Fondazione Eni Enrico Mattei (FEEM) ( email )

Campo S. M. Formosa, Castello 5252
Venezia, 30122
Italy
+39 04 1271 1470 (Phone)
+39 04 1271 1461 (Fax)

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
153
Abstract Views
1,216
rank
209,660
PlumX Metrics