Green Technology Adoption and the Business Cycle

We analyze the adoption of green technology in a dynamic economy affected by random shocks where demand spillovers are the main driver of technological improvements. Firms' beliefs and consumers' anticipations drive the path of the economy. We derive the optimal policy of investment subsidy and the expected time and likelihood of reaching a targeted level of environmental quality under economic uncertainty. This allows us to estimate the value that should be given to the environment in order to avoid an environmental catastrophe as a function of the strength of spillover effects.

• Publication year

  2017

• Venue

  Social Science Research Network

• Publication date

  2017-04-18

• Fields of study

  Economics, Environmental Science

• Identifiers
  DOI 10.2139/SSRN.2952910
• External record

  Open on Semantic Scholar

• Source metadata

  Semantic Scholar

• No claims are published for this paper.

• No concepts are published for this paper.

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