International Energy R&D Spillovers and the Economics of Greenhouse Gas Atmospheric Stabilization

Valentina Bosetti, Carlo Carraro () and Emanuele Massetti

No 2007_11, Working Papers from Department of Economics, University of Venice "Ca' Foscari"

Abstract: This paper explores how international knowledge flows affect the dynamics of the domestic R&D sector and the main economic and environmental variables. The analysis is performed using WITCH, a dynamic regional model of the world economy, in which energy technical change is endogenous. The focus is on disembodied energy R&D international spillovers. The knowledge pool from which regions draw foreign ideas differs between High Income and Low Income countries. Absorption capacity is also endogenous in the model. The basic questions are as follows. Do knowledge spillovers enhance energy technological innovation in different regions of the world? Does the speed of innovation increase? Or do free-riding incentives prevail and international spillovers crowd out domestic R&D efforts? What is the role of domestic absorption capacity and of policies designed to enhance it? The new specification of the WITCH model presented in this paper enables us to answer these questions. Our analysis shows that international knowledge spillovers tend to increase free-riding incentives and decrease the investments in energy R&D. We also analyze the implication of a policy mix in which climate policy is combined with a technology policy designed to enhance absorption capacity in developing countries. Significant positive impacts on the costs of stabilising GHG concentrations are singled out.

Keywords: Climate Policy; Energy R&D; International R&D Spillovers; Stabilization (search for similar items in EconPapers)
JEL-codes: H0 H2 H3 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2007
New Economics Papers: this item is included in nep-ene, nep-env and nep-ino
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Related works:
Journal Article: International energy R&D spillovers and the economics of greenhouse gas atmospheric stabilization (2008)
Working Paper: International Energy R&D Spillovers and the Economics of Greenhouse Gas Atmospheric Stabilization (2007)
Working Paper: International Energy R&D Spillovers and the Economics of Greenhouse Gas Atmospheric Stabilization (2007)
Working Paper: International Energy R&D Spillovers and the Economics of Greenhouse Gas Atmospheric Stabilization (2007)
Working Paper: International Energy R&D Spillovers and the Economics of Greenhouse Gas Atmospheric Stabilization (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:ven:wpaper:2007_11

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