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Technology transfer with transboundary pollution: A signalling approach

Author

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  • Fuhai Hong
Abstract
There are increasing complaints from the developing world that developed countries seem reluctant to transfer green technology, despite its benefits in helping to solve the climate problem. Identifying a signalling effect of technology transfer that was neglected by the previous literature, this paper offers a rationale for this reluctance in a North‐South model with transboundary pollution. In a benchmark case with complete information, the North makes complete technology transfer, leading to a Pareto improvement. However, if the North's valuation on climate damage is its private information, the North does not completely transfer the technology in “almost all” of the equilibria. Transfert de technologie quand il y a pollution transfrontière : une approche en termes de signaux. Il y a de plus en plus de plaintes dans le monde en développement que les pays développés sont réticents à transférer la technologie verte, malgré les avantages que cela procurerait pour aider à résoudre les problèmes liés aux changements climatiques. Identifiant cet effet de signalisation du transfert de technologie qui a été négligé dans la littérature spécialisée, ce texte suggère des raisons pour expliquer cette réticence dans un modèle Nord‐Sud avec pollution transfrontière. Dans un cas de figure avec information complète, le Nord effectue un transfert complet de technologie, menant à une amélioration à la Pareto. Cependant si l’évaluation du dommage causé par le climat est son information privée, le Nord ne transfère pas complètement la technologie dans presque tous les équilibres.

Suggested Citation

  • Fuhai Hong, 2014. "Technology transfer with transboundary pollution: A signalling approach," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 47(3), pages 953-980, August.
    • Handle: RePEc:wly:canjec:v:47:y:2014:i:3:p:953-980
    DOI: 10.1111/caje.12102
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    References listed on IDEAS

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    Cited by:

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    2. Fuhai Hong & Yu Pang, 2024. "Mitigation and adaptation: an informational perspective," Journal of Economics, Springer, vol. 141(1), pages 57-92, January.
    3. Kai A. Konrad & Marcel Thum, 2018. "Does a Clean Development Mechanism Facilitate International Environmental Agreements?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 69(4), pages 837-851, April.
    4. Chiu Yu Ko & Bo Shen & Xuyao Zhang, 2023. "Can corruption encourage clean technology transfer?," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 25(3), pages 459-492, June.
    5. Matthieu Glachant & Julie Ing & Jean Philippe Nicolai, 2017. "The Incentives for North-South Transfer of Climate-Mitigation Technologies with Trade in Polluting Goods," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 66(3), pages 435-456, March.

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