THE ADOPTION OF CLEANER HOUSEHOLD TECHNOLOGIES: WHEN IS BACKFIRE WELFARE-IMPROVING?

Peter Kennedy ()
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Peter Kennedy: Department of Economics, University of Victoria, https://www.uvic.ca/socialsciences/economics/
Authors registered in the RePEc Author Service: Peter E. Kennedy and Peter William Kennedy

No 2011, Department Discussion Papers from Department of Economics, University of Victoria

Abstract: I examine a setting in which households with “green preferences” choose between two available technologies on the basis of their costs, and on the basis of their associated emissions. The green preferences give rise to a reciprocal externality among the households, the correction of which requires policy intervention. In the absence of corrective policy, the adoption of a cleaner technology can be welfare-improving even when it induces an increase in emissions (backfire). A reduction in emissions is neither necessary nor sufficient for the equilibrium adoption of a cleaner technology to be welfare-improving. Mandated adoption of a cleaner technology – when households have otherwise chosen not to adopt it – is never welfare-improving if it induces backfire.

Keywords: backfire; clean technology; energy-efficiency; greenhouse gases; rebound (search for similar items in EconPapers)
Pages: 43 pages
Date: 2022-12-01
New Economics Papers: this item is included in nep-ene and nep-env
Note: ISSN 1914-2838 JEL Classifications: Q52, Q55, Q58
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