Unilateral, second-best carbon taxes are analysed in a two-period, two-country model with international trade in final goods, oil and bonds. The increase in oil demand and acceleration of global warming resulting from a future carbon tax are large if the price elasticities of oil demand are...

The global response to a catastrophic shock to productivity which becomes more imminent with global warming is to have carbon taxes to curb the risk of a calamity and to accumulate precautionary capital to facilitate smoothing of consumption. Our multi-region model of growth and climate change...

The Green Paradox states thata gradually more ambitious climate policy such as a renewables subsidy or an anticipated carbon tax induces fossil fuel owners to extract more rapidly and accelerate global warming However, if extraction becomes more costly as reserves are depleted, such policies...

Optimal climate policy should act in a precautionary fashion to deal with tipping points that occur at some future random moment. The optimal carbon tax should include an additional component on top of the conventional present discounted value of marginal global warming damages. This component...

Mitigating climate change by carbon capture and storage (CCS) will require vast infrastructure investments. These investments include pipeline networks for transporting carbon dioxide (CO2) from industrial sites ('sources') to the storage sites ('sinks'). This paper considers the decentralised...

We show how a monopolistic owner of oil reserves responds to a carbon-free substitute becoming available at some uncertain point in the future if demand is isoelaastic and variable extraction costs are zero but upfron exploration investment costs have to be made. Not the arrival of this...

Resource wars can be modeled with two-way regime switch uncertainty and contest success functions. Fighting is more intense if the plitical system is less cohesive, fighting technology is well developed, oil reserves are high and the wage is low. More government stability intensifies resource...

A classroom model of global warming, fossil fuel depletion and the optimal carbon tax is formulated and calibrated. It features iso-elastic fossil fuel demand, stock-dependent fossil fuel extraction costs, an exogenous interest rate and no decay of the atmospheric stock of carbon. The optimal...

We introduce learning into a Hotelling model of a non-renewable resource market. Bycombining learning and scarcity we add signi?cantly to the dynamics implied by learning and substantially enhance the volatility of commodity prices. In our learning model we show how a self con?rming equilibrium...