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Advantageous Leadership in Public Good Provision: The Case of an Endogenous Contribution Technology

Wolfgang Buchholz () and Michael Eichenseer

No 6352, CESifo Working Paper Series from CESifo Group Munich

Abstract: From the perspective of standard public good theory the total amount of greenhouse gas mitigation (or public good supply in general) will be lower in a leader-follower game than in a simultaneous Nash game so that strategic leadership is disadvantageous for climate policy. We show that this need no longer be true when the leading country has the option to employ a technology by which it can reduce its abatement costs and thus improve the productivity of its contribution technology. Our general result is illustrated by an example with Cobb-Douglas preferences and, finally, an empirical application to global climate policy is briefly discussed.

Keywords: public goods; leadership; choice of technology; climate policy (search for similar items in EconPapers)
JEL-codes: C72 H41 O31 Q54 Q55 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-agr, nep-ene and nep-env
Date: 2017
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Related works:
Journal Article: Advantageous leadership in public good provision: the case of an endogenous contribution technology (2019) Downloads
Working Paper: Advantageous Leadership in Public Good Provision: The Case of an Endogenous Contribution Technology (2017) Downloads
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