Environment

Laurence Kotlikoff, Felix Kubler, Andrey Polbin, Simon Scheidegger, 27 October 2021

The replacement of positive with normative economics has left climate policy in its sorry state – as a fight between generations, across regions, and even among economists over climate justice. This column uses a multi-region, overlapping generations model of climate change to study climate policy as an externality whose resolution can uniformly and equally benefit all humankind, regardless of year or place of birth. The optimal uniform welfare-improving policy, implemented via a time-varying global carbon tax plus region- and generation-specific net transfers, can materially limit global emissions, dramatically shorten the use of fossil fuels, and raise the welfare of all current and future agents by over 4%.

Giovanni Peri, Frédéric Robert-Nicoud, 11 October 2021

Climate change is a defining challenge of our times. This column introduces a special issue of the Journal of Economic Geography on climate change, which provides foundations for well-informed policymaking by addressing two main themes of the economic geography of climate change. First, climate change yields heterogeneous effects across space. Second, a crucial aspect of human adaptation to climate change is geographic mobility. As a consequence, limitations to mobility will worsen the socioeconomic costs of climate change. Other margins of adjustment covered in the issue include fertility, specialisation, and trade.

Francesco Caselli, Alexander Ludwig, Rick van der Ploeg, 08 October 2021

The target for global warming agreed on in the 2015 Paris Agreement implies that effective policies must be implemented to reduce emissions for the whole planet as soon as possible and reach net zero in the second half of the 21st century. The contributions in a new CEPR eBook aim to identity, for each of the featured nations, which climate change policies will have the fastest and/or largest cumulative impact, and which are the most technically, financially, or politically feasible. Although the low-hanging fruit in climate policy vary across countries, this does not mean that one country cannot learn from the debates taking place in another.

Patrick Bolton, Stefan Reichelstein, Marcin Kacperczyk, Christian Leuz, Gaizka Ormazabal, Dirk Schoenmaker, 04 October 2021

The overwhelming majority of publicly listed companies around the world still do not disclose their carbon emissions, and even fewer privately held companies do so. This column introduces a new CEPR Policy Insight in which the authors argue that mandatory carbon disclosures can make an elementary but essential contribution to the global drive towards a net zero economy, and recommend a mandate for the governments represented at COP26 to adopt.

Maria Chiara Paoli, Rick van der Ploeg, 04 October 2021

Despite climate justice advocates continuing to highlight climate inequities along racial, gender and class dimensions and policymakers’ vague statements in support of a ‘just transition’, there are few concrete plans. This column uses microsimulations of household behaviour from UK data to investigate the efficiency and equity impacts of different ways of recycling carbon tax revenue, focusing on both horizontal and vertical equity dimensions, and their implications for political feasibility. The authors find that rebating carbon tax revenues through social security payments renders the policy progressive and benefits the highest share of households in their sample.

Other Recent Articles:

Events

CEPR Policy Research