This paper revisits one of the rare success stories in global environmental cooperation: the Montreal Protocol and the phase-out of ozone-depleting substances. I show that the protocol increased science and innovation on alternatives to ozone-depleting substances and argue that agreements can indeed be useful to solving global public goods problems. This contrasts with game-theoretical predictions that agreements occur only when costs to the players are low, and with the often-heard narrative that substitutes were readily available. I reconcile theory and empirics by discussing the role of induced innovation in models of environmental agreements.

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22 September 2023     Paper Number CEPDP1947

Download PDF - Induced innovation and international environmental agreements: evidence from the ozone regime

This CEP discussion paper is published under the centre's Growth programme, Green Transition programme.

This publication comes under the following theme: Clean growth