Emission caps and investment in green technologies
Event details
| Date | 28.11.2025 |
| Hour | 11:00 › 12:15 |
| Speaker | Augustin Landier - HEC Paris |
| Location |
UNIL, Extranef, room 126
|
| Category | Conferences - Seminars |
| Event Language | English |
We study the interaction between firms, which can invest in green technologies, and government, which can impose emission caps but has limited commitment power. Investment in green technologies generates innovation spillovers, reducing the cost of further investments. Spillovers generate intertemporal strategic complementarities between firms and government, and equilibrium multiplicity. In a "green equilibrium'', firms, anticipating caps, invest in green technologies, which reduces the cost of further investment, making the government willing to cap emissions. In a "brown equilibrium'', firms anticipating don't invest, so green technologies remain costly and the government gives up on emission caps.
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