“The Voracity Effect” and Climate Change: The Impact of Clean Technologies

We show that a technological breakthrough that reduces CO2 emissions per output can exacerbate the climate change problem: countries may respond by raising their emissions resulting in an increase of the stock of pollution that may reduce welfare. Using parameter values based on empirical evidence we obtain that any 'new technology' that reduces the emissions of CO2 per dollar of GDP by less than 76% from their current level is welfare reducing. Developing clean technologies as well as transferring “cleaner” technologies to developing countries make a global post-Kyoto agreement over the control of emissions all the more urgent.


Issue Date:
2011-01
Publication Type:
Working or Discussion Paper
PURL Identifier:
http://purl.umn.edu/99642
Total Pages:
33
JEL Codes:
Q20; Q54; Q55; Q58; C73
Series Statement:
SD
5.2011




 Record created 2017-04-01, last modified 2017-08-25

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