This paper addresses the timing and interdependence between innovation and environmental policy in a model of research … and development (R&D). On a first-best path the environmental tax is set at the Pigouvian level, independent of innovation …. However, with finite patent lifetime, optimal innovation policy depends on the stage of the environmental problem. In the …

margin innovation decision (i.e. whether to conduct innovation) from the intensive margin decision (i.e. how much to innovate … innovation towards REN and away from FF technologies. Yet, we find that these factors have a larger impact on closing the … technology gap through the entry (and exit) of small specialized firms, rather than through large mixed firms' innovation. An …

on innovation activities. In addition, we find that price-based policy instruments are more effective in fostering …

energy R&D expenditures. Technological innovation is measured using patent counts for specific technologies related to energy …