Climate physics predicts that the intensity of natural disasters will increase in the future due to climate change. One of the biggest challenges for economic modeling is the inherent uncertainty of climate events, which crucially aects consumption, investment,and abatement decisions. We present...

We study the eects of greenhouse gas emissions on optimum growth and climate policy by using an endogenous growth model with polluting non-renewable resources. Climate change harms the capital stock. Our main contribution is to introduce and extensively explore the naturally determined time lag...

Africa is well endowed with potential for hydro and solar power, but its other endowments – shortages of capital, skills, and governance capacity – make most of the green options relatively expensive, while its abundance of hydro-carbons makes fossil fuels relatively cheap. Current power...

This paper develops a model in which supply of a non-renewable resource can adjust through two margins: the rate of depletion and the rate of field opening. Faster depletion of existing fields means that less of the resource can ultimately be extracted, and optimal depletion of open fields...

I develop a unique database of international fossil-fuel subsidies by examining country-specific patterns in carbon emission-to-GDP ratios, known as emission-intensities. For most - but not all - countries, intensities tend to be hump-shaped with income. I construct a model of...

What is the optimal instrument design and choice for a regulator attempting to control emissions by private agents in face of uncertainty arising from business cycles? In applying Weitzman's result [Prices vs. quantities, Review of Economic Studies, 41 (1974), 477-491] to the problem of...

This paper examines the impact of the oil price boom in the 1970s and the subsequent bust on non-oil economic activity in oil-dependent countries. During the boom, manufacturing exports and value added increased significantly relative to non-oil dependent countries,along with wages, employment,...

The Green Paradox states that, in the absence of a tax on CO2 emissions, subsidizing a renewable backstop such as solar or wind energy brings forward the date at which fossil fuels become exhausted and consequently global warming is aggravated. We shed light on this issue by solving a model of...

We analyse optimal carbon taxes, optimal redistribution within and between non-overlapping generations, and optimal spending levels on climate abatement and adaptation. A positive probability of unexpected large increases in CO2 emissions results in a lower discount rate for global warming...

Countries that are reliant upon commodity exports periodically face large adverse price shocks. Given past volatility the present high world prices for commodities may be a precursor to such shocks. Unsurprisingly, adverse price shocks reduce the growth of constant-price GDP and we analyze which...