How Large Are the Welfare Gains from Technological Innovation Induced by Environmental Policies?

Ian Parry, William Pizer and Carolyn Fischer

No 10448, Discussion Papers from Resources for the Future

Abstract: This paper examines whether the welfare gains from technological innovation that reduces future abatement costs are larger or smaller than the "Pigouvian" welfare gains from optimal pollution control. The relative welfare gains from innovation depend on three key factors ¾ the initially optimal level of abatement, the speed at which innovation reduces future abatement costs, and the discount rate. We calculate the welfare gains from innovation under a variety of different scenarios. Mostly they are less than the Pigouvian welfare gains. To be greater, innovation must reduce abatement costs substantially and quickly and the initially optimal abatement level must be fairly modest.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 29
Date: 2002
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
https://ageconsearch.umn.edu/record/10448/files/dp00015r.pdf (application/pdf)

Related works:
Journal Article: How Large Are the Welfare Gains from Technological Innovation Induced by Environmental Policies? (2003)
Working Paper: How Large Are the Welfare Gains from Technological Innovation Induced by Environmental Policies? (2002)
Working Paper: How Large Are the Welfare Gains from Technological Innovation Induced by Environmental Policies? (2002)
Working Paper: How Large Are the Welfare Gains from Technological Innovation Induced by Environmental Policies? (2002)
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:ags:rffdps:10448

DOI: 10.22004/ag.econ.10448

Access Statistics for this paper

More papers in Discussion Papers from Resources for the Future Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().