Technology Adoption by Heterogeneous Producers to Regulate a Stock Externality

This paper presents a framework to determine optimal resource allocation over time for the production of a good by heterogeneous producers who generate a stock externality. We analyze the optimal intertemporal and quality-specific combination of abatement strategies at the source given by a change in the intensity of production and in the chosen technology, and/or removal of existing pollution stock. The results show how the specifications of the production and the emission functions affect technology adoption and the design of the optimal intertemporal combination of source and stock abatement strategies. Moreover, the paper shows that regulation at the intensive margin cannot be considered as a substitute for a regulation at the extensive margin. The paper employs the so-called two-stage solution approach for solving the resulting quality distributed-intertemporal optimal control problem.

Issue Date:
Publication Type:
Conference Paper/ Presentation
Record Identifier:
PURL Identifier:
Total Pages:
Series Statement:
Selected Paper 135556

 Record created 2017-04-01, last modified 2018-01-22

Download fulltext

Rate this document:

Rate this document:
(Not yet reviewed)