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The Optimal Timing of the Transition to New Environmental Technology for Economic Growth
College of Arts and Sciences, the University of Tokyo
Graduate School of Economics, Kyoto University
- 1 College of Arts and Sciences, the University of Tokyo
- 2 Graduate School of Economics, Kyoto University
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Abstract
This study investigates the best timing for technological change affecting environmental quality in economic development. We develop a model that addresses the transition of environmental technology from an old system to a new one. Findings obtained are innovative in that they depict when as well as how transition to new environmental technology occurs. It demonstrates that the timing is endogenous and characterized by the properties of the economy: in particular, the optimal technology transition timing depends upon whether the economy is developing or developed.
KeywordsEnvironmental QualityOptimal StoppingTechnological Change
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