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Taxation of carbon emissions with social and private discount rates

Mier, Mathias; Adelowo, Jacqueline - 2022

Energy system and power market models refrain from distinguishing between private and social discount rates. We devise a strategy to account for diverging private and social discount rates in intertemporal optimization frameworks, resulting in an optimal carbon tax above the marginal damage when...

Persistent link: https://www.econbiz.de/10013329795

Complementary taxation of carbon emissions and local air pollution

Mier, Mathias; Adelowo, Jacqueline; Weissbart, Christoph - 2022

Current decarbonization policies neglect damages from local air pollutants. We analyze the trade-off between complementary taxation of carbon emissions and local air pollution. We quantify results for the European power market until 2050. Taxing only air pollution results in social cost of 5,890...

Persistent link: https://www.econbiz.de/10013329808

Investment policy for time-inconsistent discounters

Harstad, Bård - 2013

This paper explores how a principal with time-inconsistent preferences invests optimally in technology or capital. If the current principal prefers her future self to save more, she can increase current investments complementary to future savings and decrease investments in the strategic...

Persistent link: https://www.econbiz.de/10010223357

Underinvestment and Slow Growth : PWBM Concedes Flaws

Simkovic, Michael - 2021

against public investment. This budget scoring process systematically underestimates the benefits of public investment and … fund public investment is amplified by a think tank, the Penn Wharton Budget Model (PWBM). The PWBM assumes that taxes and … debt have devastating effects on economic growth and assumes away much of the benefit of public investment. These strong …

Persistent link: https://www.econbiz.de/10013249451

Do carbon offsets offset carbon?

Calel, Raphael; Colmer, Jonathan; Dechezleprêtre, Antoine - 2021

We develop and implement a new method for identifying wasted subsidies, and use it to provide systematic evidence on the misallocation of carbon offsets in the Clean Development Mechanism - the world's largest carbon offset program. Using newly constructed data on the locations and...

Persistent link: https://www.econbiz.de/10012650589

Commitment vs. Discretion in Climate and Energy Policy

Habermacher, Florian - 2017

To decarbonize the power sector policy-makers need to commit to long-term credible rules for climate and energy policy. Otherwise, time-inconsistent policy-making will impair investments into low-carbon technologies. However, the future benefits and costs of decarbonization are subject to...

Persistent link: https://www.econbiz.de/10012960475

An Investment Optimization Model for the Firms Pursuing Energy Saving and Carbon Emission Reduction Technology

Liu, Yang - 2015

This paper employs real option analysis to evaluate the investment project to adopt energy saving and carbon emission … government support in the investment decision. That is, government support lies in two major directions to encourage the adoption … the green technology, and to increase the risk-free return rate. The candidate measures to lower the investment threshold …

Persistent link: https://www.econbiz.de/10013011427

Carbon pricing under binding political constraints

Jenkins, Jesse D.; Karplus, Valerie J. - Joint Institute for Strategic Energy Analysis - 2016

The economic prescription for climate change is clear: price carbon dioxide (CO2) and other greenhouse gas emissions to internalize climate damages. In practice, a variety of political economy constraints prevent the introduction of a carbon price equal to the full social cost of emissions. This...

Persistent link: https://www.econbiz.de/10011456178

Leakage, Welfare, and Cost-Effectiveness of Carbon Policy

Baylis, Kathy - 2013

We extend the model of Fullerton, Karney, and Baylis (2012 working paper) to explore cost-effectiveness of unilateral climate policy in the presence of leakage. We ignore the welfare gain from reducing greenhouse gas emissions and focus on the welfare cost of the emissions tax or permit scheme....

Persistent link: https://www.econbiz.de/10013086612

Optimal Energy Taxes and Subsidies under a Cost-Effective Unilateral Climate Policy : Addressing Carbon Leakage

Kruse-Andersen, Peter - 2019

We analyze how a country pursuing a unilateral climate policy may contribute to a reduction in global CO2 emissions in a cost-effective way. To do so its system of energy taxes and subsidies must account for leakage of emissions from the domestic to the foreign economy. We focus on leakage...

Persistent link: https://www.econbiz.de/10012859989