Adoption Gaps of Environmental Adaptation Technologies with Public Effects

Abstract As the Intergovernmental Panel on Climate Change (2018) testifies, world is a long way from halting climate change, let alone reverting it. The existence of adaptation and mitigation technologies did not prove sufficient, their adoption being respectively faulted or hindered by presence externalities. In this work, we study how externalities, whether positive negative, lead system away Pareto-dominant (social optimum) states, towards Pareto-dominated ones. We show that gaps, i.e. differences between socially optimum vs current shares, both (mal)adaptation are caused externalities emitted. particular, over-adoption may occur for maladaptive technologies, whereas under-adoption in case mitigation. employ model with two regions at different stages development also derive relevant considerations possible counterproductive effects green policies environmental dumping.