Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/63106
Authors: 
Kverndokk, Snorre
Rosendahl, Knut Einar
Rutherford, Thomas F.
Year of Publication: 
2004
Series/Report no.: 
Memorandum, Department of Economics, University of Oslo 2004,05
Abstract: 
We study the role of technology subsidies in climate policies, using a simple dynamic equilibrium model with learning-by-doing. The optimal subsidy rate of a carbon-free technology is high when the technology is first adopted, but falls significantly over the next decades. However, the efficiency costs of uniform instead of optimal subsidies, may be low if there are introduction or expansion constraints for a new technology. Finally, supporting existing energy technologies only, may lead to technology lock-in, and the impacts of lock-in increase with the learning potential of new technologies as well as the possibilities for early entry and thight carbon constraints.
Subjects: 
Climate change policies
Computable equilibrium models
Induced technological change
Subsidies
Timing
JEL: 
D58
H21
O30
Q42
Document Type: 
Working Paper

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