Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/159499
Authors: 
Dragone, Davide
Lambertini, Luca
Palestini, Arsen
Year of Publication: 
2009
Series/Report no.: 
Quaderni - Working Paper DSE 658
Abstract: 
The established view on oligopolistic competition with environmental externalities has it that, since firms neglect the external effect, their incentive to invest in R&D for pollution abatement is nil unless they are subject to some form of environmental taxation. We take a dynamic approach to this issue, using a simple differential game to show that the conclusion reached by the static literature is not robust, as the introduction of dynamics shows that firms do invest in R&D for environmental-friendly technologies throughout the game. Moreover, our setup also illustrates the existence of multiple equilibria, only one of which is identified by the corresponding static game.
Persistent Identifier of the first edition: 
Creative Commons License: 
https://creativecommons.org/licenses/by-nc/3.0/
Document Type: 
Working Paper

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