In the last two decades, large-scale CGE models used for environmental policy assessment underwent an important upgrade to
integrate endogenous technological progress. Nevertheless, several complexities of innovation are still neglected even if
they are of primary interest for policymakers. This paper provides a review of the current state of the art in the CGE modelling
literature through a special lens. We discuss how existing models deal with dfferent types of innovation (i.e., product and
process innovation) and how differences in innovation activities influence modelling results. We also emphasise the implications
of product innovation in a multi-sector framework, which has received little attention in the literature.
Forschungsbereich:Klima-, Umwelt- und Ressourcenökonomie