The Effect Of Environmental Policy On Environmental R & D Strategy And Social Welfare Under Duopoly Market Structure

With the aggravation of environmental problem and the enhancement of environmental protection awareness, protecting our earth and reducing the emission of pollutant have become a consensus of the human beings. On the practice of environmental protection, firm's investment on environmental R&D is the most effective ways, while as a profit maximization institution; the firm has no motivation of adding environmental R&D. It has aroused more and more concerns from acad emic world and policy makers that how to use environmental policy instruments to provide firms with incentives to invest on environmental R&D and reducing the emission of pollutant. Numerous studies have also shown that different environmental policies can provide incentives with different level, and different market structure will also product great effect on environmental R&D investment. This paper analyze how environmental policy instruments affect firms'incentives to invest on environmental R&D, evaluate the effect of R&D cooperation and technology migration on social surplus, environmental R&D level and the emission of pollutant and provide graphics explanation through functional simulation and numerical example, hoping to give some advice on the policy setting.The main contents of this paper are as follows:(1) Studies the research achievements of present literatures and summarizes their characteristics and insufficiencies.(2) Build duopoly environmental game theoretical model on the basis of present research, analyze firms'environmental R&D strategy and product strategy under three different environmental policies(emission trading program, standards, tax), and evaluate the environmental policies from the aspect of social welfare, environmental R&D, and pollutant emission and provide graphics explanation through functional simulation and numerical example.(3) In the end of the paper, I summarize the room for improvement in my work and some fields which are worth of further study.