In a Ramsey policy regime, heterogeneity in beliefs about the potential costs of climate change is shown to produce policy ambiguities that alter carbon prices and taxation. Three sources of ambiguity are considered: (i) the private sector is skeptical, with beliefs that are unknown to the...

It is frequently observed that the implementation of green policies is delayed compared to the initial announcement. Considering a setting with a representative monopolist extracting a non-renewable resource, we demonstrate that announcing a green policy, but then delaying its implementation, is...

It is frequently observed that the implementation of green policies is delayed compared to the initial announcement. Considering a setting with a representative monopolist extracting a non-renewable resource, we demonstrate that announcing a green policy, but then delaying its implementation, is...

Whereas hydrogen is currently a marginal energy carrier, the aim of the EU is to trigger low-carbon hydrogen production that covers around 10 percent of EU’s energy needs by 2050. If this comes true, it will be an energy revolution. We study competition between green and blue hydrogen by...

It is widely acknowledged that the transition towards a zero-emissions economy requires electrification of energy-related processes across all sectors of the economy — so-called sector coupling. In our analysis we consider countries whose electricity sectors are regulated by a multilateral...

The favored federal policy to address climate change is a domestic cap-and-trade system. However, a vocal minority of political leaders have begun arguing in favor of a carbon tax. Carbon taxes seem particularly attractive both for fiscal reasons and because they provide certainty over the price...

This paper develops an overlapping-generations model characterized by endogenous growth, unemployment, and pollution. The paper focuses on the replacement ratio, which measures the proportion of after-tax work earnings replaced by unemployment benefits, and considers a replacement-ratio-neutral...

Whether or not the federal government should price carbon continues to be debated. There were several scholarly pieces examining the relative advantages and disadvantages of cap and trade v. a carbon tax at the time of Congressional Debate on the American Clean Energy and Security Act in 2010....

Global warming can be curbed by pricing carbon emissions and thus substituting fossil fuel with renewable energy consumption. Breakthrough technologies (e.g., fusion energy) can reduce the cost of such policies. However, the chance of such a technology coming to market depends on investment. We...

Most people are convinced that climate change is a threat and that it should somehow be dealt with. It is also clear that CO2 emissions are still too cheap and must be priced higher to sufficiently curtail emissions. Yet how high should a carbon tax be? Answering this question requires...