This article re-examines the question of how to optimally tax air travel within the model from Gallego and van Ryzin (1994), in which a monopolistic airline chooses its dynamic pricing policy to sell tickets to randomly arriving consumers over a finite time horizon until the plane departs. In...

Consider a world with complete information in which a global institution receives an exogenous flow of funding which it can use to curb fossil fuels by rewarding countries for reducing supply or reducing demand. I show that the ex ante optimal path of reward payment schemes is not time...

Consider a global institution with an exogenous budget that can reward each developing country based on its tax rate on the combustion of a given fossil fuel. I develop a model in which countries differ in the co-benefits that they derive from emissions reductions and also in their aversion to...

Existing international environmental institutions curb fossil fuels by rewarding countries for reducing demand and expanding substitutes. This paper argues that it would be beneficial to create new institutions that would reward countries for reducing their fossil fuel supply. Assuming complete...

This short note presents a simple model in which firms choose the speed at which they do maritime shipping of goods. Per percentage point of ad valorem tax on the shipping fuel, all ships' speed decreases by about 0.33%, leading to a reduction of fuel consumption by about 0.66%

In times of COVID-19, there are negative externalities associated with in-store shopping since if one is infectious one might transmit the disease to others. What is the optimal Pigovian subsidy for home delivery of food to internalize this externality? To address this question, we develop a...

The EU is considering taking unilateral action to achieve higher carbon pricing for international aviation. It has been proposed that the EU could start a club mechanism whereby participating countries would have to tax (or include in an emissions trading scheme) the emissions of all outgoing...