This paper compares the optimal dynamic choices between policies of mitigation and adaptation for three economies: Brazil, Chile and the United States. The focus is on the optimal role of mitigation and adaptation for 'environmentally small economies,' i.e., economies that are witnessing an...

One reason carbon prices are difficult to implement is that they might imply high additional costs on poor and vulnerable households. In response, studies often highlight that recycling revenues through cash transfers can render carbon pricing reforms progressive. This neglects that existing...

One reason carbon prices are difficult to implement is that they might imply high additional costs on poor and vulnerable households. In response, studies often highlight that recycling revenues through cash transfers can render carbon pricing reforms progressive. This neglects that existing...

To mitigate climate change, some governments opt for instruments focused on investment, like performance standards or feebates, instead of carbon prices. We compare these policies in a Ramsey model with clean and polluting capital, irreversible investment and a climate constraint. Alternative...

Countries have pledged to stabilize global warming at a 1.5 to 2êC increase. Either target requires reaching net zero emissions before the end of the century, which implies a major transformation of the economic system. This paper reviews the literature on how policymakers can design climate...

This paper finds that it is optimal to start a long-term emission-reduction strategy with significant short-term abatement investment, even if the optimal carbon price starts low and grows progressively over time. Moreover, optimal marginal abatement investment costs differ across sectors of the...

Energy subsidies account for about 7% of Ecuador's yearly public spending, or two thirds of the fiscal deficit. Removing these subsidies would yield clear economic and environmental benefits and help implement climate targets set in the Paris Agreement. However, expected adverse effects on...

Using data for all 2,454 municipalities of Mexico for the period 1980-2010, this paper analyzes the relationship between exposure to extreme temperatures and precipitation and death, as well as the relationship between severe weather and agricultural income and crop production in the country. It...

In cities around the world, Covid-19 lockdowns have improved outdoor air quality, in some cases dramatically. Even if only temporary, these improvements could have longer-lasting effects on policy by making chronic air pollution more salient and boosting political pressure for change. To that...

Environmental policies are characterized by salient short-term costs and long-term benefits that are difficult to observe and to attribute to the government's efforts. These characteristics imply that citizens' support for environmental policies is highly dependent on their trust in the...