This paper presents the first empirical test of the green paradox hypothesis, according to which well-intended but imperfectly implemented policies may lead to detrimental environmental outcomes due to supply side responses. We use the introduction of the Acid Rain Program in the U.S. as a case...

The focus of the green paradox literature has been either on demand-side climate policies or on effects of technological changes. The present paper addresses the question of whether there also might be some kind of green paradox related to supply-side policies, i.e. policies that per-manently...

If bioenergy has a less negative impact on the climate than fossil energy, it may be optimal to have a significant increase in the use of bioenergy over time. Due to the difference in the way the climate is affected by the two types of energy, the future time path of the use of bioenergy may be...

During recent years increased attention has been given to second-generation wood-based bioenergy. The carbon stored in the forest is highest when there is little or no harvest from the forest. Increasing the harvest from a forest, in order to produce more bioenergy, may thus conflict with the...

Since governments can influence the demand for a new abatement technology through their environmental policy, they may be able to expropriate innovations in new abatement technology ex post. This suggests that incentives for environmental R&D may be lower than the incentives for market goods...

Several recent articles have analyzed climate policy giving explicit attention to the non-renewable character of carbon resources. In most of this literature the economy is treated as a single unit, which in the context of climate policy seems reasonable to interpret as the whole world. However,...

A sufficiently rapidly rising carbon tax may increase near-term emissions compared with the case of no carbon tax. Even so, such a carbon tax path may reduce total costs related to climate change, since the tax may reduce total carbon extraction. A government cannot commit to a specific carbon...

Taking a political economy perspective this paper proposes an alternative carbon abatement policy instrument with significant advantages over existing policy instruments. The key feature of the proposed carbon securities is that they entitle their owners to a fixed proportion of ex ante unknown...

The focus of the green paradox literature has been either on demand-side climate policies or on effects of technological changes. The present paper addresses the question of whether there also might be some kind of green paradox related to supply-side policies, i.e. policies that per-manently...

During recent years increased attention has been given to second-generation wood-based bioenergy. The carbon stored in the forest is highest when there is little or no harvest from the forest. Increasing the harvest from a forest, in order to produce more bioenergy, may thus conflict with the...