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Promoting green or restricting gray? An analysis of green portfolio standards

Hiroaki Ino and Toshihiro Matsumura ()

Economics Letters, 2021, vol. 198, issue C

Abstract: This study theoretically examines green portfolio standards with monetary penalties in an oligopoly market. We find that green portfolio standards attain first-best optimality if the purpose of the government is to restrict non-green products (i.e., unless the negative externality of gray products is too small), whereas they are inefficient policy tools if the purpose is to promote green products.

Keywords: Green industrial policy; Negative externality of gray products; Positive externality of green products; Renewable portfolio standards; Zero emission vehicle program; Employment promotion program (search for similar items in EconPapers)
JEL-codes: Q58 Q48 L51 (search for similar items in EconPapers)
Date: 2021
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Working Paper: Promoting Green or Restricting Gray? An Analysis of Green Portfolio Standards (2020) Downloads
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DOI: 10.1016/j.econlet.2020.109650

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