ASU Electronic Theses and Dissertations
- 1 English
- 1 Public
This paper presents a two-period general equilibrium model that incorporates the firm's learning-by-doing under the green subsidies. I use a dynamic version of the Dixit-Stiglitz monopolistic competition model to analyze the impact of the introduction of green subsidies in the presence of pre-existing effluent taxes. I first show that the introduction of green subsidies promotes the demand for green goods, and consumers are better off each period. I then show that even when the green subsidies directly accrue to consumers, firms in the green sector also benefit via boosted demand for green goods. The learning-by-doing effect accelerates the speed of …
- Chung, Myunghun, Hanemann, W. Michael, Datta, Manjira, et al.
- Created Date