Analizing International seminar
paper
1.
Abstrak
“This paper
introduces endogenous and directed technical change in a growth model with
environmental constraints. A unique final good is produced by combining inputs
from two sectors. One of these sectors uses “dirty” machines and thus creates
environmental degradation. Research can be directed to improving the technology
of machines in either sector. We characterize dynamic tax policies that achieve
sustainable growth or maximize intertemporal welfare. We show that: (i) in the
case where the inputs are sufficiently substitutable, sustainable long-run
growth can be achieved with temporary taxation of dirty innovation and
production; (ii) optimal policy involves both “carbon taxes” and research
subsidies, so that excessive use of carbon taxes is avoided; (iii) delay in
intervention is costly:
the sooner and
the stronger is the policy response, the shorter is the slow growth transition
phase; (iv) the use of an exhaustible resource in dirty input production helps
the switch to clean innovation under laissez-faire when the two inputs are
substitutes. Under reasonable parameter values and with sufficient
substitutability between inputs, it is optimal to redirect technical change
towards clean technologies immediately and optimal environmental regulation
need not reduce long-run growth.”
Analysis:
This paper explain that to reduce
environmental demage due to technical changes, it is necessary to substitute
between “Dirty” input and “Clean” input. Therefore, we need an long-term
optimal environmental regulation.
2.
Discussion
:
This
paper istalking about “ THE ENVIRONMENT AND DIRECTED TECHNICAL
CHANGE”
3. Analysis of paragraph :
-
Paragraph 1 contains
A
satisfactory framework for the study of the costs and benefits of different
environmental policies must therefore include at its centerpiece the endogenous
response of different types of technologies to proposed policies.
-
Paragraph
2 contains a framework highlights the central roles played by the market size
and the price effects on the direction of tehnical change.
-
Paragraph
3 contains a Without intervention, the economy would rapidly head towards an
environmental disaster, in particular, because the market size effect and the
initial productivity advantage of dirty inputs would direct innovation and
production to that sector, contributing to environmental degradation.
-
Paragraph
4 Contains a model also nests the Stern/Al Gore and Greenpeace answers.
-
Paragraph
5 contains a even though a carbon tax would by itself discourage research in
the dirty sector.
4. Conclution :
This search result recommends therefore, an optimal regulastion is
neended to reduce environmental degradation.
5. Paper analyzed : “http://su.diva-portal.org/smash/get/diva2:345160/FULLTEXT01”
