Work

Strategic responses to automobile emissions control: A game-theoretic analysis

Year: 1988

Type: article

Abstract: This paper examines the dynamics of standard-setting regulation under technological uncertainty and asymmetric information about technological capability. A two-period model which allows fully strategic action is developed and applied to the regulation of automobile emissions, a situation in which standards have been used to “force” innovation. It is found that the initial level of R & D activity caused by regulation increases with the intrinsic technical capability of industry. This result done not depend on marginal productivities of research that favor high-capability types and implies that a poor-capability industry will not attempt to compensate for its inability to innovate with increased research activity. It is also found that the regulator's ability to induce investment is greater when R & D is likely to be unsuccessful.

Source: Journal of Environmental Economics and Management

DOI: 10.1016/0095-0696(88)90036-8

Author: Dennis A Yao

Institution: University of Pennsylvania

Language: English

Topic: Climate Change Policy and Economics

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDG: Industry, innovation and infrastructure

Open Access status: hybrid

Estimated APC paid: $3,620