During the last decade, Norway has carried out an ambitious climate policy. The main policy tool is a relatively high carbon tax, which was implemented already in 1991. Data for the development in CO2 emissions since then provide a unique opportunity to evaluate carbon taxes as a policy tool. To...

Although environmental regulations may imply a cost increase on firm's conventional input factors, such regulations could stimulate the incentives to improve factor productivity. Productivity measures including indicators capturing environmental improvements may also show higher or lower...

In 2002/2003, the Nordic hydro-dominated power market faced a short-term supply shock. In autumn, precipitation and inflow were unusually low. As a result, there were record high prices in the following winter. Questions were raised whether the deregulated market creates sufficient incentives to...

Productivity measures ignoring environmental effects may give misleading information on total productivity growth. Further, business cycles in the form of capacity utilization may also significantly influence productivity measures. In this paper, we develop an overall Malmquist productivity...

Over the last few decades, several instruments have evolved to deal with similar energy and environmental challenges. For instance, the economic literature prescribes separate tax or cap-and-trade systems to internalize negative environmental externalities and subsidies to internalize positive...

The purpose of environmental taxes is to correct the market when it fails to take environmental damages into account, i.e. to internalize the Pigouvian element. In addition, fiscal taxes are levied on both polluting and clean goods, which may follow the Ramsey principle. In practical policy,...

Standard economic theory provides clear guidance on the design of cost-efficient policy in the presence of imperfect markets and externalities. However, observed policies reveal extensive discrepancies between principles and practise. Based on interviews with core politicians from the Norwegian...