Innovation and risk-averse firms: Options on carbon allowances as a hedging tool
Author
Abstract
Suggested Citation
DOI: 10.1016/j.enpol.2014.03.012
Download full text from publisher
As the access to this document is restricted, you may want to search for a different version of it.
References listed on IDEAS
- Valentina Bosetti & Ruben Lubowski (ed.), 2010. "Deforestation and Climate Change," Books, Edward Elgar Publishing, number 13733.
- Pindyck, Robert S., 1993.
"Investments of uncertain cost,"
Journal of Financial Economics, Elsevier, vol. 34(1), pages 53-76, August.
- Robert S. Pindyck, 1992. "Investments of Uncertain Cost," NBER Working Papers 4175, National Bureau of Economic Research, Inc.
- Criqui, Patrick & Mima, Silvana & Viguier, Laurent, 1999. "Marginal abatement costs of CO2 emission reductions, geographical flexibility and concrete ceilings: an assessment using the POLES model," Energy Policy, Elsevier, vol. 27(10), pages 585-601, October.
- Dechezlepretre, Antoine & Glachant, Matthieu & Hascic, Ivan & Johnstone, Nick & Meniere, Yann, 2009.
"Invention and Transfer of Climate Change Mitigation Technologies on a Global Scale: A Study Drawing on Patent Data,"
Sustainable Development Papers
54361, Fondazione Eni Enrico Mattei (FEEM).
- Antoine Dechezlepr�tre & Matthieu Glachant & Ivan Hascic & Nick Johnstone & Yann M�ni�re, 2010. "Invention and transfer of climate change mitigation technologies on a global scale: a study drawing on patent data," GRI Working Papers 17, Grantham Research Institute on Climate Change and the Environment.
- Matthieu Glachant & Antoine Dechezleprêtre & Ivan Hascic & Nick Johnstone & Yann Ménière, 2009. "Invention and Transfer of Climate Change Mitigation Technologies on a Global Scale: A Study Drawing on Patent Data," Working Papers 2009.82, Fondazione Eni Enrico Mattei.
- Dechezlepretre, Antoine & Glachant, Matthieu & Hascic, Ivan & Johnstone, Nick & Meniere, Yann, 2010. "Invention and transfer of climate change mitigation technologies on a global scale: a study drawing on patent data," LSE Research Online Documents on Economics 37590, London School of Economics and Political Science, LSE Library.
- repec:bla:ecnote:v:33:y:2004:i:1:p:23-54 is not listed on IDEAS
- Valentina Bosetti & Ruben Lubowski & Alexander Golub & Anil Markandya, 2009.
"Linking Reduced Deforestation and a Global Carbon Market: Impacts on Costs, Financial Flows, and Technological Innovation,"
Working Papers
2009.56, Fondazione Eni Enrico Mattei.
- Valentina Bosetti & Ruben Lubowski & Alexander Golub & Anil Markandya, 2010. "Linking Reduced Deforestation and a Global Carbon Market: Impacts on Costs, Financial Flows, and Technological Innovation," Working Papers 2009-01, BC3.
- Bosetti, Valentina & Lubowski, Ruben N. & Golub, Alexander & Markandya, Anil, 2009. "Linking Reduced Deforestation and a Global Carbon Market: Impacts on Costs, Financial Flows, and Technological Innovation," Sustainable Development Papers 52544, Fondazione Eni Enrico Mattei (FEEM).
- Antoine Dechezleprêtre & Matthieu Glachant & Ivan Haščič & Nick Johnstone & Yann Ménière, 2011.
"Invention and Transfer of Climate Change--Mitigation Technologies: A Global Analysis,"
Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 5(1), pages 109-130, Winter.
- Antoine Dechezleprêtre & Matthieu Glachant & Ivan Hascic & Nick Johnstone & Yann Ménière, 2011. "Invention and transfer of climate change-mitigation technologies: A global analysis," Post-Print hal-00488214, HAL.
- Dechezlepretre, Antoine & Glachant, Matthieu & Hascic, Ivan & Johnstone, Nick & Meniere, Yann, 2011. "Invention and transfer of climate change-mitigation technologies: a global analysis," LSE Research Online Documents on Economics 37667, London School of Economics and Political Science, LSE Library.
- Sue Wing, Ian, 2006. "Representing induced technological change in models for climate policy analysis," Energy Economics, Elsevier, vol. 28(5-6), pages 539-562, November.
- Dixit, Avinash K. & Pindyck, Robert S., 1995. "The new option view of investment," Working papers 3794-95., Massachusetts Institute of Technology (MIT), Sloan School of Management.
- Szolgayova, Jana & Fuss, Sabine & Obersteiner, Michael, 2008. "Assessing the effects of CO2 price caps on electricity investments--A real options analysis," Energy Policy, Elsevier, vol. 36(10), pages 3974-3981, October.
- Peter S. Reinelt & David W. Keith, 2007. "Carbon Capture Retrofits and the Cost of Regulatory Uncertainty," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 101-128.
- Bosetti, Valentina & Tavoni, Massimo, 2009.
"Uncertain R&D, backstop technology and GHGs stabilization,"
Energy Economics, Elsevier, vol. 31(Supplemen), pages 18-26.
- Bosetti, Valentina & Tavoni, Massimo, 2007. "Uncertain R&D, Backstop Technology and GHGs Stabilization," Climate Change Modelling and Policy Working Papers 12048, Fondazione Eni Enrico Mattei (FEEM).
- Valentina Bosetti & Massimo Tavoni, 2007. "Uncertain R&D, Backstop Technology and GHGs Stabilization," Working Papers 2007.6, Fondazione Eni Enrico Mattei.
- Davis, Graham A. & Owens, Brandon, 2003. "Optimizing the level of renewable electric R&D expenditures using real options analysis," Energy Policy, Elsevier, vol. 31(15), pages 1589-1608, December.
- Popp, David, 2004. "ENTICE: endogenous technological change in the DICE model of global warming," Journal of Environmental Economics and Management, Elsevier, vol. 48(1), pages 742-768, July.
- Gillingham, Kenneth & Newell, Richard G. & Pizer, William A., 2008.
"Modeling endogenous technological change for climate policy analysis,"
Energy Economics, Elsevier, vol. 30(6), pages 2734-2753, November.
- Gillingham, Kenneth T. & Newell, Richard G. & Pizer, William A., 2007. "Modeling Endogenous Technological Change for Climate Policy Analysis," RFF Working Paper Series dp-07-14, Resources for the Future.
- Siddiqui, Afzal & Fleten, Stein-Erik, 2010.
"How to proceed with competing alternative energy technologies: A real options analysis,"
Energy Economics, Elsevier, vol. 32(4), pages 817-830, July.
- Siddiqui, Afzal & Fleten, Stein-Erik, 2008. "How to Proceed with Competing Alternative Energy Technologies: a Real Options Analysis," MPRA Paper 15502, University Library of Munich, Germany, revised 04 May 2009.
- McKitrick, Ross, 1999. "A Derivation of the Marginal Abatement Cost Curve," Journal of Environmental Economics and Management, Elsevier, vol. 37(3), pages 306-314, May.
- Fuss, Sabine & Szolgayova, Jana & Golub, Alexander & Obersteiner, Michael, 2011. "Options on low-cost abatement and investment in the energy sector: new perspectives on REDD," Environment and Development Economics, Cambridge University Press, vol. 16(4), pages 507-525, August.
- Goulder, Lawrence H. & Mathai, Koshy, 2000. "Optimal CO2 Abatement in the Presence of Induced Technological Change," Journal of Environmental Economics and Management, Elsevier, vol. 39(1), pages 1-38, January.
Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
Cited by:
- Alexander Golub & Jon Anda & Anil Markandya & Michael Brody & Aldin Celovic & Angele Kedaitiene, 2022.
"Climate alpha and the global capital market,"
Working Papers
2022.19, Fondazione Eni Enrico Mattei.
- Golub, Alexander & Anda, Jon & Markandya, Anil & Brody, Michael & Celovic, Aldin & Kedaitiene, Angele, 2022. "Climate alpha and the global capital market," FEEM Working Papers 322792, Fondazione Eni Enrico Mattei (FEEM).
- Compernolle, T. & Welkenhuysen, K. & Huisman, K. & Piessens, K. & Kort, P., 2017. "Off-shore enhanced oil recovery in the North Sea: The impact of price uncertainty on the investment decisions," Energy Policy, Elsevier, vol. 101(C), pages 123-137.
- Krasovskii, Andrey & Khabarov, Nikolay & Obersteiner, Michael, 2016. "Fair pricing of REDD-based emission offsets under risk preferences and benefit-sharing," Energy Policy, Elsevier, vol. 96(C), pages 193-205.
- Golub, Alexander & Lubowski, Ruben & Piris-Cabezas, Pedro, 2017. "Balancing Risks from Climate Policy Uncertainties: The Role of Options and Reduced Emissions from Deforestation and Forest Degradation," Ecological Economics, Elsevier, vol. 138(C), pages 90-98.
- Golub, Alexander A. & Lubowski, Ruben N. & Piris-Cabezas, Pedro, 2020. "Business responses to climate policy uncertainty: Theoretical analysis of a twin deferral strategy and the risk-adjusted price of carbon," Energy, Elsevier, vol. 205(C).
- Zheng, Wei & Li, Bo & Song, Dongping & Li, Yanran, 2023. "Innovative development strategy of a risk-averse firm considering product unreliability under competition," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 172(C).
- Hu, Junfei & Chen, Huanyue & Zhou, Peng & Guo, Peng, 2022. "Optimal subsidy level for waste-to-energy investment considering flexibility and uncertainty," Energy Economics, Elsevier, vol. 108(C).
- Su, Chi Wei & Wei, Shenkai & Wang, Yan & Tao, Ran, 2024. "How does climate policy uncertainty affect the carbon market?," Technological Forecasting and Social Change, Elsevier, vol. 200(C).
Most related items
These are the items that most often cite the same works as this one and are cited by the same works as this one.- Mort Webster & Karen Fisher-Vanden & David Popp & Nidhi Santen, 2017.
"Should We Give Up after Solyndra? Optimal Technology R&D Portfolios under Uncertainty,"
Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 4(S1), pages 123-151.
- Mort D. Webster & Karen Fisher-Vanden & David Popp & Nidhi R. Santen, 2015. "Should We Give Up After Solyndra? Optimal Technology R&D Portfolios under Uncertainty," CESifo Working Paper Series 5448, CESifo.
- Mort Webster & Karen Fisher-Vanden & David Popp & Nidhi Santen, 2015. "Should We Give Up After Solyndra? Optimal Technology R&D Portfolios under Uncertainty," NBER Working Papers 21396, National Bureau of Economic Research, Inc.
- Joshua S. Gans, 2012. "Innovation and Climate Change Policy," American Economic Journal: Economic Policy, American Economic Association, vol. 4(4), pages 125-145, November.
- Baker, Erin & Clarke, Leon & Shittu, Ekundayo, 2008. "Technical change and the marginal cost of abatement," Energy Economics, Elsevier, vol. 30(6), pages 2799-2816, November.
- Baker, Erin & Shittu, Ekundayo, 2008. "Uncertainty and endogenous technical change in climate policy models," Energy Economics, Elsevier, vol. 30(6), pages 2817-2828, November.
- Mare Sarr & Joëlle Noailly, 2017. "Innovation, Diffusion, Growth and the Environment: Taking Stock and Charting New Directions," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 66(3), pages 393-407, March.
- Fertig, Emily, 2018. "Rare breakthroughs vs. incremental development in R&D strategy for an early-stage energy technology," Energy Policy, Elsevier, vol. 123(C), pages 711-721.
- Popp, David & Newell, Richard G. & Jaffe, Adam B., 2010.
"Energy, the Environment, and Technological Change,"
Handbook of the Economics of Innovation, in: Bronwyn H. Hall & Nathan Rosenberg (ed.), Handbook of the Economics of Innovation, edition 1, volume 2, chapter 0, pages 873-937,
Elsevier.
- David Popp & Richard G. Newell & Adam B. Jaffe, 2009. "Energy, the Environment, and Technological Change," NBER Working Papers 14832, National Bureau of Economic Research, Inc.
- Léo Coppens & Simon Dietz & Frank Venmans, 2024.
"Optimal Climate Policy under Exogenous and Endogenous Technical Change: Making Sense of the Different Approaches,"
CESifo Working Paper Series
11059, CESifo.
- Coppens, Léo & Dietz, Simon & Venmans, Frank, 2024. "Optimal climate policy under exogenous and endogenous technical change: making sense of the different approaches," LSE Research Online Documents on Economics 124548, London School of Economics and Political Science, LSE Library.
- Wei Jin & ZhongXiang Zhang, 2016.
"China's pursuit of environmentally sustainable development: Harnessing the new engine of technological innovation,"
CCEP Working Papers
1601, Centre for Climate & Energy Policy, Crawford School of Public Policy, The Australian National University.
- Jin, Wei & Zhang, ZhongXiang, 2016. "China’s Pursuit of Environmentally Sustainable Development: Harnessing the New Engine of Technological Innovation," EIA: Climate Change: Economic Impacts and Adaptation 232926, Fondazione Eni Enrico Mattei (FEEM).
- Jin, Wei & Zhang, ZhongXiang, 2016. "China’s pursuit of environmentally sustainable development: Harnessing the new engine of technological innovation," Working Papers 249520, Australian National University, Centre for Climate Economics & Policy.
- Wei Jin & ZhongXiang Zhang, 2016. "China’s Pursuit of Environmentally Sustainable Development: Harnessing the New Engine of Technological Innovation," Working Papers 2016.24, Fondazione Eni Enrico Mattei.
- Wei Jin & ZhongXiang Zhang, 2014.
"From Energy-intensive to Innovation-led Growth: On the Transition Dynamics of China’s Economy,"
Working Papers
2014.100, Fondazione Eni Enrico Mattei.
- Jin, Wei & Zhang, ZhongXiang, 2014. "From Energy-intensive to Innovation-led Growth: On the Transition Dynamics of China’s Economy," Energy: Resources and Markets 190757, Fondazione Eni Enrico Mattei (FEEM).
- Gunter Stephan & Georg Müller-Fürstenberger, 2015. "Global Warming, Technological Change and Trade in Carbon Energy: Challenge or Threat?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 62(4), pages 791-809, December.
- Bibas, Ruben & Méjean, Aurélie & Hamdi-Cherif, Meriem, 2015.
"Energy efficiency policies and the timing of action: An assessment of climate mitigation costs,"
Technological Forecasting and Social Change, Elsevier, vol. 90(PA), pages 137-152.
- Ruben Bibas & Aurélie Méjean & Meriem Hamdi-Cherif, 2015. "Energy efficiency policies and the timing of action: An assessment of climate mitigation costs," Post-Print hal-01086071, HAL.
- Naqvi, Asjad & Stockhammer, Engelbert, 2018.
"Directed Technological Change in a Post-Keynesian Ecological Macromodel,"
Ecological Economics, Elsevier, vol. 154(C), pages 168-188.
- Asjad NAQVI & Engelbert STOCKHAMMER, 2017. "Directed Technological Change in a post-Keynesian Ecological Macromodel," Ecological Economics Papers ieep16, Institute of Ecological Economics.
- Asjad Naqvi & Engelbert Stockhammer, 2017. "Directed technological change in a post-Keynesian ecological macromodel," Working Papers PKWP1714, Post Keynesian Economics Society (PKES).
- Naqvi, Syed Ali Asjad & Engelbert, Stockhammer, 2017. "Directed Technological Change in a post-Keynesian Ecological Macromodel," Ecological Economic Papers 16, WU Vienna University of Economics and Business.
- Kemfert, Claudia & Truong, Truong, 2007.
"Impact assessment of emissions stabilization scenarios with and without induced technological change,"
Energy Policy, Elsevier, vol. 35(11), pages 5337-5345, November.
- Claudia Kemfert & Truong P. Truong, 2005. "Impact Assessment of Emissions Stabilization Scenarios with and without Induced Technological Change," Discussion Papers of DIW Berlin 530, DIW Berlin, German Institute for Economic Research.
- Gillingham, Kenneth & Newell, Richard G. & Pizer, William A., 2008.
"Modeling endogenous technological change for climate policy analysis,"
Energy Economics, Elsevier, vol. 30(6), pages 2734-2753, November.
- Gillingham, Kenneth T. & Newell, Richard G. & Pizer, William A., 2007. "Modeling Endogenous Technological Change for Climate Policy Analysis," RFF Working Paper Series dp-07-14, Resources for the Future.
- Wei Jin & ZhongXiang Zhang, 2014. "Quo Vadis? Energy Consumption and Technological Innovation in China's Economic Growth," CCEP Working Papers 1412, Centre for Climate & Energy Policy, Crawford School of Public Policy, The Australian National University.
- Koch, Nicolas & Reuter, Wolf Heinrich & Fuss, Sabine & Grosjean, Godefroy, 2017. "Permits vs. offsets under investment uncertainty," Resource and Energy Economics, Elsevier, vol. 49(C), pages 33-47.
- Wei Jin, 2012. "Can China Harness Globalization to Reap Carbon Savings? Modeling International Technology Diffusion in a Multi-region Framework," CAMA Working Papers 2012-52, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
- Gregory Casey, 2024.
"Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation,"
The Review of Economic Studies, Review of Economic Studies Ltd, vol. 91(1), pages 192-228.
- Casey, Gregory, "undated". "Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 259959, Agricultural and Applied Economics Association.
- Gregory P. Casey, 2022. "Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation," CESifo Working Paper Series 9580, CESifo.
- Casey, Gregory, 2017. "Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation," MPRA Paper 76416, University Library of Munich, Germany.
- Gregory Casey, 2019. "Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation," Department of Economics Working Papers 2019-17, Department of Economics, Williams College.
- Enrica Cian & Valentina Bosetti & Massimo Tavoni, 2012. "Technology innovation and diffusion in “less than ideal” climate policies: An assessment with the WITCH model," Climatic Change, Springer, vol. 114(1), pages 121-143, September.
More about this item
Keywords
Carbon trading scheme; Stochastic technological change; Option pricing;All these keywords.
Statistics
Access and download statisticsCorrections
All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:enepol:v:70:y:2014:i:c:p:227-235. See general information about how to correct material in RePEc.
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/enpol .
Please note that corrections may take a couple of weeks to filter through the various RePEc services.