 What growth policies protect the environment? A two-engine growth modelChu-chuan Cheng, Ping-ho Chen, Hsun Chu and Yi-chiuan Wang Journal of Macroeconomics, 2024, vol. 81, issue C Abstract: This paper compares the effects of patent protection and subsidy policies on growth and the environment in a model where technology innovation and capital accumulation are both engines of growth. Pollution is a by-product of the intermediate goods, and can be reduced by public abatement activities. The results show that, compared to subsidies, stronger patent protection is a more promising tool for achieving a double dividend, i.e., simultaneously enhancing growth and improving the environment. By contrast, a uniform increase in the subsidy rate on R&D and capital stimulates growth but harms the environment, implying a trade-off relationship between growth and the environment. For sector-specific subsidies, an R&D subsidy is superior to a capital subsidy in terms of environmental protection, but this superiority fades away if the productivity of abatement labor or the public abatement expenditure is higher. Keywords: Two growth engines; Environmental quality; Patent policy; Subsidy policy (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jmacro:v:81:y:2024:i:c:s0164070424000296 DOI: 10.1016/j.jmacro.2024.103614 Access Statistics for this article Journal of Macroeconomics is currently edited by Douglas McMillin and Theodore Palivos More articles in Journal of Macroeconomics from Elsevier |
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