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This study investigates the impact of firms' emissions on their investments in renewable energy. Stricter environmental regulations are aimed at incentivizing firms to invest in low-emission/pollution technologies such as renewable energy. Recently, the People's Republic of China (PRC) announced...
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's technology investment and production decisions.We show that under the cap-and-trade policy, with the uncertainty of the future … increase its technology investment to hedge against the future risk of a high emission price. Making a comparison between the … generates a multi-win situation (i.e., higher expected profit and consumer surplus, more technology investment, and less carbon …
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