This paper evaluates green stimulus packages that were introduced in response to the global financial crisis (GFC) of 2007-08 and draws lessons relevant for greening the recovery from the Coronavirus (COVID-19) crisis. The paper underscores the importance of building in policy evaluation...

For any emission trading system (ETS) with quantity-based endogenous supply of allowances, there exists a negative demand shock, e.g. induced by abatement policy, that increases aggregate supply and thus cumulative emissions. We prove this green paradox for a general model and then apply it to...