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Title:Climate change mitigation options and directed technical change: a decentralized equilibrium analysis PDF Logo
Authors:Grimaud , André
Lafforgue , Gilles
Magné , Bertrand
Issue Date:2009
Series/Report no.:CESifo working paper 2875
Abstract:The paper considers a climate change growth model with three R&D sectors dedicated to energy, backstop and CCS (Carbon Capture and Storage) efficiency. First, we characterize the set of decentralized equilibria: A particular equilibrium is associated to each vector of public tools which includes a carbon tax and a subsidy to each R&D sector. Moreover, we show that it is possible to compute any equilibrium as the solution of a maximization program. Second, we solve the first-best optimum problem and we implement it by computing the vector of optimal tools. Finally, we illustrate the theoretical model using some calibrated functional specifications. In particular, we investigate the effects of various combinations of public policies (including the optimal ones) by determining the deviation of each corresponding equilibrium from the laisser-faire benchmark.
Subjects:climate change
energy
CCS
directed technical change
carbon tax
R&D subsidies
JEL:H23
O32
Q43
Q54
Q55
Document Type:Working Paper
Appears in Collections:CESifo Working Papers, CESifo Group Munich

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