Innovation Market Failures and the Design of New Climate Policy Instruments / Sarah C. Armitage, Noël Bakhtian, Adam B. Jaffe.

Format:

Book

Author/Creator:

Armitage, Sarah C.

Contributor:

National Bureau of Economic Research.

Bakhtian, Noël.

Jaffe, Adam B.

Series:

Working Paper Series (National Bureau of Economic Research) no. w31622.

NBER working paper series no. w31622

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2023.

Summary:

Moving beyond the combination of adoption subsidies, standards, and (albeit limited) attempts at carbon pricing that largely characterized U.S. climate policy over the last decade, recent climate-related legislation has transformed not only the scale of U.S. climate activities but also the policy mechanisms adopted. Newly scaled policy instruments -- including demonstration projects, loan guarantees, green banks, and regional technology hubs -- are motivated not only by un-priced carbon externalities but also by innovation market failures. This paper maps the economics literature on innovation market failures and other frictions to the stated goals of these policy instruments, with the goal of focusing discussions about how to implement these policies as effectively as possible. The paper also discusses how program evaluation can help to illuminate which market failures are most relevant in a particular context and which policy instruments are most targeted to them.

Notes:

Print version record

August 2023.