Environmental Technological Choice in a Cournot-Bertrand Model
Elias Asproudis () and
Eleftherios Filippiadis ()
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Elias Asproudis: University of Swansea
Eleftherios Filippiadis: University of Macedonia
Journal of Industry, Competition and Trade, 2021, vol. 21, issue 1, No 3, 43-58
Abstract This paper investigates the abatement technology choice in Cournot-Bertrand, as well as in pure Cournot and Bertrand duopolies. It is argued that, under certain conditions, the Bertrand firm will choose a “dirtier” technology compared to its Cournot rival. Furthermore, when competing in quantities, firms choose greener technologies than when competing in prices. This is because higher abatement rates make a firm choosing quantity relatively more aggressive than a firm choosing price, irrespective of the strategic variable of its rival. Moreover, it is shown that the introduction of abatement technologies will increase total output in the market and decrease total emissions.
Keywords: Oligopoly theory; Environment; Technological choice; Competition; Cournot-Bertrand (search for similar items in EconPapers)
JEL-codes: C72 D01 L13 Q5 Q55 (search for similar items in EconPapers)
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