Before revision:  By modelling the process of innovation-diffusion and  non-equilibrium dynamics, we establish how climate policy instruments for emissions reductions alter economic activity through energy prices, government spending, enhanced investment and tax revenues.
After revision:  By modelling the process of innovation-diffusion and that in many cases, results are simply re-iterations of model assumptions. We show that, while equilibrium economics always predict economic slowdown, methods using non-equilibrium dynamics, we establish how climate policy instruments for emissions reductions alter economic activity through energy prices, government spending, enhanced investment and tax revenues.