Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/307800 
Year of Publication: 
2023
Series/Report no.: 
Helsinki GSE Discussion Papers No. 19
Publisher: 
Helsinki Graduate School of Economics, Helsinki
Abstract: 
The extraction of carbon energy contributes to the global stock of pollution, increasing the risk of welfare-damaging environmental dis- aster. The governments of the countries educate workers as scientists. Oligopolists produce goods by workers and carbon energy. R&D firms improve efficiency by scientists to supplant incumbent oligopolists through competition, which generates economic growth. In this setup, an international central planner can decentralize the social optimum by setting a precautionary tax on emissions before the occurrence of the disaster. That tax hampers pollution, but speeds up economic growth. The socially optimal level of the tax is derived.
Subjects: 
emissions
pollution
R&D
endogenous growth
environmental disaster
precautionary policy
JEL: 
H21
O32
O44
Q54
Q58
ISBN: 
978-952-7543-18-4
Document Type: 
Working Paper

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