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Social preferences for distributive outcomes of climate policy

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  • Lea S. Svenningsen

    (Technical University of Denmark)

Abstract

This study examines whether people exhibit social preferences for the distributive outcomes of climate policy when making actual donations towards such policies. In an online choice experiment, using a real donation mechanism, a sample of 95 members of the Danish public are provided 27 € and asked to make 16 donation choices among different climate policy options. The climate policies are described in terms of two main outcome variables: future effects on income in 2100 and present-time provision of co-benefits from climate policy. Both outcomes are described for three specific regions of the world, Western Europe, Southeast Asia and Sub-Saharan Africa. For each participant, one policy choice is drawn at random to be realized. The total amount donated by participants is used to purchase and withdraw CO2 quotas and credits in the European Emission Trading Scheme and as donations to the UN Adaptation Fund. The results indicate that distributional outcomes matter for people when they donate to climate policy and that elements of both inequity aversion and general altruism influence the choice of climate policy. The findings contribute towards an empirical foundation for the use of equity weights in determining the social cost of carbon, with the implication that the price on greenhouse gas emissions should be higher due to the concern for distributional impacts.

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  • Lea S. Svenningsen, 2019. "Social preferences for distributive outcomes of climate policy," Climatic Change, Springer, vol. 157(2), pages 319-336, November.
    • Handle: RePEc:spr:climat:v:157:y:2019:i:2:d:10.1007_s10584-019-02546-y
    DOI: 10.1007/s10584-019-02546-y
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    2. Feldhaus, Christoph & Gleue, Marvin & Löschel, Andreas & Werner, Peter, 2022. "Co-benefits motivate individual donations to mitigate climate change," Research Memorandum 004, Maastricht University, Graduate School of Business and Economics (GSBE).
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