The paper applies the synthetic control method to examine the effects of California's Capand-Trade Program on environmental innovation. The analysis exploits the International Patent Classification system to identify patents relating to environmentally sound technologies. This enables the study...

We analyze the use of patent protection as a new policy to direct technical change to clean technology. Contrary to popular belief, it is dirty (and not clean) innovations that should be excluded from patent protection to reduce emissions. In the shortrun, removing patent protection on dirty...

There is widespread concern that climate policy is moving too slowly and that decarbonization of economic development is coming too late for effective climate protection. We analyze three different effects that emerge endogenously during decarbonization and amplify current policies: growing...

How should governments best allocate their budget to support private research activities? The consensus in the literature is that sector-specific R&D support policies should be increasing in the degree of compatibility of sectoral innovation with the practices of the wider economy. Using a...

Optimum commodity taxation theory asks how to raise a given amount of tax revenue while minimizing distortions. We reexamine Ramsey’s inverse elasticity rule in presence of Hotelling-type non-renewable natural resources. Under standard assumptions borrowed from the...

Domestic consumption taxes on oil products largely differ across countries, ranging from very high subsidies to very high taxes. The empirical literature on the issue has highlighted the role of revenue-raising (Ramsey commodity taxation) and externalitycorrection (Pigovian taxation) motives for...

We examine how the final say in a sequence of proposals for local public project provision, financing, and redistribution can be channeled towards socially desirable outcomes, thereby breaking the dictatorial power of the last agenda-setter. Individuals are heterogeneous with some citizens...

Governments design taxation schemes to capture resource rent. However, they usually propose contracts with limited duration and possess less information on the resources than the extractive firms do. This paper investigates how information asymmetry on costs and an inability to commit to...

This paper argues that the joint relation between long-term orientation, environmental quality and innovation plays a key role in explaining environment-poverty traps. Based on empirical observations, we allow for the subjective discount rate to negatively depend on environmental quality in an...

The elasticity of substitution between clean and dirty energy and the direction of technological change are central parameters in discussing one of the most challenging questions today, climate change. Despite their importance, there are few studies that empirically estimate these key...