This paper deals with two different types of irreversibility: Pollution irreversibility occurs if the stock of pollution cannot be reduced (any more) by nature's assimilative capacity; characteristics irreversibility occurs when some characteristic of the environmental resource is irreversibly...

A small open economy produces a consumer good along with green and black energy and imports fossil fuel for black-energy production at an uncertain world market price. Efficient risk management requires curbing fuel consumption, and hence carbon emissions, when consumers are prudent. Moreover,...

We study the incidence of carbon-reduction and green-energy promotion policies in a general equilibrium small open economy that depends on imports of fossil fuels. The focus is on mixed policies that are either price based (emissions taxes and producer price subsidies for green energy) or...