Environmental Technology Transfer in a Cournot Duopoly: The Case of Fixed-Fee Licensing

Akira Miyaoka ()
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Akira Miyaoka: Graduate School of Economics, Osaka University

No 14-08, Discussion Papers in Economics and Business from Osaka University, Graduate School of Economics

Abstract: This study considers a Cournot duopoly market in which a clean firm can transfer its less polluting technology to a dirty firm through a fixed-fee licensing contract. We analyze the impacts of emissions taxes on the incentives of firms to transfer technology as well as on the total pollution level, and examine the properties of the optimal emissions tax policy. We first show that higher emissions taxes weaken incentives for technology transfer and that this can lead to a perverse increase in the level of total pollution. We then compare the optimal emissions tax when technology licensing is possible with that when licensing is infeasible and show that the relationship between the optimal tax rate and the degree of the initial technology gap between firms when licensing is possible can be the opposite of that when licensing is infeasible.

Keywords: Technology transfer; Cournot duopoly; Pollution; Emissions tax (search for similar items in EconPapers)
JEL-codes: L13 L24 Q58 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2014-02
New Economics Papers: this item is included in nep-com, nep-ene, nep-env, nep-pbe and nep-res
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Persistent link: https://EconPapers.repec.org/RePEc:osk:wpaper:1408

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