Green technology adoption under uncertainty, increasing returns, and complex adaptive dynamics

Sanjit Dhami and Paolo Zeppini

Post-Print from HAL

Abstract: We consider firms' choices between a clean technology that benefits, and a dirty technology that harms, the environment. Green firms are more suited to the clean technology and brown firms are more suited to the dirty technology. We use a model derived from complexity theory that takes account of true uncertainty and increasing returns to technology adoption. We examine theoretically, the properties of the long-run equilibrium, and provide simulated time paths of technology adoption, using plausible dynamics. The long-run outcome is an 'emergent property' of the system, and is unpredictable despite there being no external technological or preference shocks. We describe the role of taxes and subsidies in facilitating adoption of the clean technology; the conflict between optimal Pigouvian taxes and adoption of clean technologies; the optimal temporal profile of subsidies; and the desirability of an international fund to provide technology assistance to poorer countries.

Keywords: Technology choice; Climate change; Complexity; Lock-in effects; Increasing returns; Green subsidies; Public policy; Pigouvian taxes; Stochastic dynamics (search for similar items in EconPapers)
Date: 2025-05
New Economics Papers: this item is included in nep-ene, nep-env, nep-ino, nep-res and nep-tid
Note: View the original document on HAL open archive server: https://cnrs.hal.science/hal-04998831v1
References: View references in EconPapers View complete reference list from CitEc
Citations:

Published in Journal of Economic Behavior and Organization, 2025, 233 (106953), ⟨10.1016/j.jebo.2025.106953⟩

Downloads: (external link)
https://cnrs.hal.science/hal-04998831v1/document (application/pdf)

Related works:
Journal Article: Green technology adoption under uncertainty, increasing returns, and complex adaptive dynamics (2025)
Working Paper: Green Technology Adoption under Uncertainty, Increasing Returns, and Complex Adaptive Dynamics (2024)
Working Paper: Green Technology Adoption under Uncertainty, Increasing Returns, and Complex Adaptive Dynamics (2024)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-04998831

DOI: 10.1016/j.jebo.2025.106953

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().