انتقالات فناوری و مکانیزم توسعه پاک در یک مدل تعادل عمومی شمال و جنوب

This paper analyses the potential welfare gains of introducing a technology transfer from Annex I to non-Annex I in order to mitigate greenhouse gas emissions. Our analysis is based on a numerical general equilibrium model for a world-economy comprising two regions; North (Annex I) and South (non-Annex I). In a cooperative equilibrium, a technology transfer from the North to the South is clearly desirable from the perspective of a ‘global social planner’, since the welfare gain for the South outweighs the welfare loss for the North. However, if the regions do not cooperate, then the incentives to introduce the technology transfer appear to be relatively weak from the perspective of the North; at least if we allow for Southern abatement in the pre-transfer Nash equilibrium. Finally, by adding the emission reductions associated with the Kyoto agreement, our results show that the technology transfer leads to higher welfare in both regions.

The importance of international cooperation in order to address the climate problem is widely recognised. This is often exemplified by the Kyoto Conference in 1997, which resulted in a protocol with legally binding emission targets. The protocol sets binding targets for the industrialised countries (Annex I), while there are no such commitments for the developing countries (non-Annex I). A relevant question is how the climate policy can be implemented in a cost-efficient way in a world where only part of the countries faces explicit emission targets. The importance of cost-efficient implementation has been recognised by the UN Framework Convention on Climate Change (UNFCCC), Art. 3.3, which states that the climate policy should “ensure global benefits at the lowest possible cost”. In practice, this means that, although the emission targets are imposed on a limited number of countries, there is some flexibility in the implementation of these targets, allowing for a more cost-efficient outcome than would otherwise be accomplished. One way of increasing the cost-efficiency is to introduce technology transfers from Annex I to non-Annex I.1 Among the countries that have ratified the UN Climate Change Convention, the industrialised countries commit themselves to “promote, facilitate and finance, as appropriate, the transfer of, or access to, environmentally sound technologies and know-how to other parties, particularly to developing countries, to enable them to implement the provisions of the Convention” (see Article 4.5 of the UNFCCC). In addition, a technology transfer needs not (necessarily) only be a means of lowering the abatement cost; it may also contribute to economic growth in the host country.2 However, despite that the idea of technology transfers has received attention in the academic as well as policy discussion, it has so far only played a minor role in practice. In the light of these observations, the purpose of this paper is to examine the likely welfare effects of technology transfers in terms of a numerical general equilibrium model. Our approach will be explained more thoroughly below. In the Kyoto protocol, the idea of technology transfers is formalised via the ‘Clean Development Mechanism’ (CDM), allowing Annex I countries to invest in projects aimed at reducing the emissions in non-Annex I countries and, at the same time, relax their own emission targets in exchange for the emission reduction induced by these projects.3 The purpose of the CDM is “to assist parties not included in Annex I in achieving sustainable development and in contributing to the ultimate objective of the convention and to assist Annex I countries in reaching their targets”.4 Previous numerical equilibrium studies typically model the CDM in a way similar to emission trading.5 However, this approach fails to recognise the first part of the purpose of the CDM (to assist non-Annex I in achieving sustainable development). Another aspect of relevance for our analysis is that the ‘non-carbon welfare effects’ associated with the CDM are potentially very important for the non-Annex I countries, when they decide on whether or not to participate in projects aiming at lower emissions. In case studies focusing on Brazil, China and India, it is shown that these countries could benefit substantially from many viable abatement projects. The non-carbon benefits include, for instance, improved air and water quality, electrification of rural and remote areas, and increased employment.6 In this paper, we simulate the welfare effects of introducing a technology transfer in a stylised world-economy comprising two regions; the North (Annex I) and the South (non-Annex I). Our analysis is based on a numerical general equilibrium, in which agents make intertemporal choices. The data and parameters for the regions are, to a large extent, based on the RICE- and DICE-models.7 Clearly, the welfare effects of a technology transfer depend on the pre-transfer resource allocation. We consider four different regimes; (i) the regions behave as uncontrolled market economies (which is our reference case), (ii) the regions are imperfectly controlled market economies, which means implementing the emission reductions associated with the Kyoto Protocol in an otherwise uncontrolled market economy, (iii) the pre-transfer resource allocation is a conditional cooperative equilibrium, where ‘conditional’ means that the resource allocation is decided upon in the absence of the option of using the transfer, and (iv) the pre-transfer resource allocation is a noncooperative Nash equilibrium. The first and the fourth regimes are interesting in the sense of representing two extreme views on how the regions behave in the absence of cooperation. The uncontrolled market economy means that all externalities remain uninternalised at the equilibrium, whereas the noncooperative Nash equilibrium implies that each region internalises the externalities it imposes on the domestic residents, while the transboundary component remains uninternalised. Although the noncooperative Nash equilibrium appears to be the most common alternative to cooperation in earlier literature on international environmental policy, both these regimes have been addressed before in various contexts.8 Despite being unrealistic from a (current) practical policy perspective, the conditional cooperative equilibrium is interesting for purposes of comparison, as it allows the preferences of both the North and the South (and not just the North as in the other regimes) to govern the decision underlying the use of the technology transfer. In addition to the distinction between the four regimes mentioned above, another novelty is that we divide the Southern economy in two sectors, referred to as the formal and informal sector, respectively. This division is reasonable since the informal sector seems to play a much more important role in developing economies than in developed economies.9 Furthermore, it enables us to assess (or at least illustrate) the importance of labour mobility between the two sectors following a technology transfer. By assumption, the formal sector is more capital intensive than the informal sector and is characterised by higher average productivity. We will return to the characteristics of the Southern economy below and also discuss alternative interpretations of the two sectors. From the perspective of the North, the technology transfer is motivated by the difference in abatement costs between the regions. However, a technology transfer may also be thought of as an investment in a new and more efficient abatement technology, which might increase total factor productivity in the Southern formal sector. The issue of unilateral technology transfers from the North to the South was raised by Yang (1999). He considers the impact of such transfers in a dynamic general equilibrium model, where greenhouse gases give rise to a transboundary externality. At the same time, the technology transfer in Yang's model does not have any direct effects on the Southern economy other than via the stock of greenhouse gases; in other words, Yang did not address the productivity-oriented effect mentioned above. Another difference between Yang's model and ours is that we allow the abatement cost differential between the regions to depend on the abatement efforts chosen by the South. Therefore, the potential benefits of a technology transfer from the North to the South depend on the level of abatement implemented by the Southern economy prior to the implementation of the transfer. The outline of the paper is as follows: In Section 2, we present the basic structure of our numerical model. Section 3 describes the data as well as the ideas underlying the calibration. The results are presented in Section 4. Section 5 gives the concluding remarks.

This paper deals with the consequences of introducing a technology transfer from the North to the South in the context of a numerical general equilibrium model. Our model comprises two regions, North and South, where the North represents the so called Annex I, or industrialised, countries in the Kyoto protocol, and the South represents the non-Annex I, or developing, countries. We distinguish between four different resource allocations prior to the introduction of the transfer; (i) uncontrolled market economies, (ii) imperfectly controlled market economies, which means imposing the emission reduction requirement in the Kyoto Protocol to the otherwise uncontrolled market economies, (iii) a cooperative equilibrium and (iv) a noncooperative Nash equilibrium. We find that a technology transfer from the North to the South, if designed appropriately, reduces the emissions and increases welfare at the global level. Given the Kyoto Protocol, our results indicate to what extent the CDM might be used in order to reduce the total costs for the North of implementing the emission reduction targets. In comparison with the reference scenario of our model, where the regions were uncontrolled market economies prior to the agreement, the results in the Kyoto restriction scenario imply that the North will make transfers to the South in order to reduce the abatement costs implied by the restriction. In addition, although the Kyoto Protocol would be beneficial for the South even without the technology transfer, the use of the transfer contributes to increase the welfare in the South, partly by a reallocation of resources from the informal to the formal sector. Although our Kyoto scenario assumes that the South is not taking sufficient domestic measures of emission abatement, it is interesting to note that also in a situation where the South were to choose the same level of domestic abatement as in the Nash equilibrium (see below), the North would still have an incentive to use the transfer in order to reach the Kyoto target at minimum cost. As opposed to the uncontrolled market economies, it is also interesting to analyse the role of the technology transfer in the context of a (hypothetical) cooperative equilibrium, as it implies that the transfer is governed by the preferences of the citizens in the North and the South. In this case, the (Utilitarian) global social planner would use the transfer instrument, because the welfare increase facing the residents in the South outweighs the welfare loss facing the residents in the North. The optimal policy implicit in the cooperative equilibrium implies abatement of the emissions originating from both regions and a technology transfer from the North to the South. If the regions behave as Nash competitors prior to the introduction of the technology transfer, and although the transfer leads to higher welfare at the global level, the incentives of using this transfer appear to be week from the perspective of the North. The reason is that the abatement carried out by the South in our model tends to reduce the abatement cost differential between the regions. On the other hand, if we were to assume that the South does not abate its own emissions, our results suggest that the North will, indeed, make a technology transfer to the South. The intuition is that the abatement cost differential (prior to the introduction of the technology transfer) becomes relatively large in this case. Therefore, if the industrialised countries are concerned with climate change, and the developing countries are only taking trivial steps to reduce their own emissions, our results suggest that it would be in the interest of the industrialised countries to transfer environmental technology to achieve abatement in a more cost-efficient way. From the Southern perspective, the technology transfer might imply large benefits; both in terms of a better environment and in terms of technological change followed by a reallocation of resources from the informal to the formal sector. Our results indicate that by introducing the possibility for using technology transfers between the industrialised and the developing countries in international climate policy, significant global welfare benefits might be achieved, both in terms of a more cost-efficient abatement from the perspective of the North and increased consumption possibilities in the South; let be that the magnitude of the latter effect is subject to considerable uncertainty. It is shown that in the absence of a global social planner, the incentives for the North to use the technology transfer might be weak, especially if we allow for Southern domestic abatement in the pre-transfer equilibrium. However, the incentives to use a technology transfer are shown to increase if South is not taking sufficient measures to reduce its own domestic emissions or if there exist legally binding emission targets, like in the Kyoto protocol, which have to be implemented. This result indicates that the CDM might play an important role when it comes to reaching the Kyoto targets to minimum cost.