TY  - JOUR
T1  - Transboundary Pollution, R&D Spillovers, Absorptive Capacity and International Trade
AU  - Dinar, Zeineb
PY  - 2014
DA  - September
JF  - International Journal of Economics and Financial Issues
JO  - IJEFI
PB  - İlhan ÖZTÜRK
WT  - DergiPark
SN  - 2146-4138
SP  - 501
EP  - 513
VL  - 4
IS  - 3
LA  - en
AB  - In this paper, we study the effects of absorptive capacity and R&D spillovers on cross-border pollution in a game played by two regulator-firm hierarchies. By means of a tax per-unit of pollution, a subsidy per-unit of original research and a subsidy per-unit of absorptive research, the regulators can reach the first-best outcome. We show that, in addition to free R&D spillovers and absorptive research, competition of firms on the common market help non-cooperating countries to better internalize transboundary pollution. More importantly, opening borders increase the per-unit emission-tax and decrease the per-unit original research subsidy. Thus, when the investment-cost parameters are sufficiently high, the international trade increases the original research, production. Consequently, the emission ratio is lower.
KW  - Transboundary pollution
KW  - R&D spillovers
KW  - absorptive capacity
KW  - international trade.
UR  - https://dergipark.org.tr/en/pub/ijefi/issue//352020
L1  - https://dergipark.org.tr/en/download/article-file/362881
ER  -