Cooperation in green R &D and environmental policies: tax or standard
In this article, we compare a tax and a standard as environmental tools depending on firms’ R &D strategy and the government’s ability to credibly commit to its policy. We consider a duopoly model where production is polluting and in an effort to mitigate emissions, firms invest in green R &...
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| Published in | Journal of regulatory economics Vol. 66; no. 2-3; pp. 205 - 237 |
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| Main Authors | , |
| Format | Journal Article |
| Language | English |
| Published |
New York
Springer US
01.12.2024
Springer Nature B.V Springer Verlag |
| Subjects | |
| Online Access | Get full text |
| ISSN | 0922-680X 1573-0468 |
| DOI | 10.1007/s11149-024-09475-4 |
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| Abstract | In this article, we compare a tax and a standard as environmental tools depending on firms’ R &D strategy and the government’s ability to credibly commit to its policy. We consider a duopoly model where production is polluting and in an effort to mitigate emissions, firms invest in green R &D (in the presence of technological spillovers) either cooperatively or non-cooperatively. We explore two policy games in which the regulator establishes an emission tax or an emission standard either before or after firms engage in R &D. We endogenize both the firms’ R &D strategy and the regulator’s choice of policy instrument. We find that an emission standard is adopted only when firms choose not to cooperate. Conversely, a tax is desirable when firms collaborate in green R &D. Moreover, we expand our framework by offering the opportunity for the regulator to authorize or ban cooperation in green R &D before the firms make their strategic decisions. |
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| AbstractList | In this article, we compare a tax and a standard as environmental tools depending on firms’ R &D strategy and the government’s ability to credibly commit to its policy. We consider a duopoly model where production is polluting and in an effort to mitigate emissions, firms invest in green R &D (in the presence of technological spillovers) either cooperatively or non-cooperatively. We explore two policy games in which the regulator establishes an emission tax or an emission standard either before or after firms engage in R &D. We endogenize both the firms’ R &D strategy and the regulator’s choice of policy instrument. We find that an emission standard is adopted only when firms choose not to cooperate. Conversely, a tax is desirable when firms collaborate in green R &D. Moreover, we expand our framework by offering the opportunity for the regulator to authorize or ban cooperation in green R &D before the firms make their strategic decisions. |
| Author | Cabon-Dhersin, Marie-Laure Raffin, Natacha |
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| Cites_doi | 10.1023/A:1012637212545 10.1016/j.eneco.2017.09.022 10.1002/mde.3567 10.1007/s10640-013-9682-7 10.1628/jite-2020-0035 10.1006/jeem.1998.1063 10.1002/mde.3842 10.1016/j.eneco.2011.07.022 10.1016/j.reseneeco.2018.04.002 10.1111/1467-8454.12243 10.1016/j.eneco.2022.105846 10.1016/j.jclepro.2023.139036 10.1016/j.iref.2018.06.001 10.1016/j.ecolecon.2004.12.028 10.1016/j.jeem.2006.07.002 10.1016/j.jebo.2004.09.015 10.1006/jeem.2001.1194 10.1111/jpet.12165 10.1007/s10640-017-0114-y 10.1515/bejeap-2015-0009 10.1023/A:1015364515904 10.1016/j.econmod.2016.01.025 10.1080/13504851.2015.1073831 10.1515/9781400879762-024 10.4337/9781035303793.00014 10.2139/ssrn.2159243 |
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| Keywords | Q55 Cournot competition Taxes P48 Policy games Spillovers R& D cooperation Competition policy Standards L13 032 |
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| SubjectTerms | Companies Cooperation Duopoly Economics Economics and Finance Emissions Environmental policy Environmental tax Industrial Organization Microeconomics Original Article Public Finance Quantitative Finance R&D Research & development Taxation Taxes |
| Title | Cooperation in green R &D and environmental policies: tax or standard |
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