Can Lobbying Encourage Abatement? Designing a New Policy Instrument
AbstractTaking a political economy perspective this paper proposes an alternative carbon abatement policy instrument with significant advantages over existing policy instruments. The key feature of the proposed carbon securities is that they entitle their owners to a fixed proportion of ex ante unknown total emissions. The total level of carbon emissions is set by the political process after the carbon securities have been sold. A key benefit of the proposed carbon security is that it creates a group of stakeholders, whose interest is for a smaller level of emissions and which competes with industries that consume significant amounts of carbon-based energy. The advantages over existing policy tools include an equilibrium carbon price closer to the level preferred by voters and a more predictable environmental policy in the presence of either climate or political uncertainty.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 3760.
Date of creation: 2012
Date of revision:
lobbying; climate policy;
Other versions of this item:
- Lange, Ian & Polborn, Sarah, 2012. "Can lobbying encourage abatement? Designing a new policy instrument," Stirling Economics Discussion Papers 2012-03, University of Stirling, Division of Economics.
- D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
- Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters
- Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Portney, Paul & Oates, Wallace, 2001.
"The Political Economy of Environmental Policy,"
dp-01-55, Resources For the Future.
- William R. Kerr & William F. Lincoln & Prachi Mishra, 2011. "The Dynamics of Firm Lobbying," NBER Working Papers 17577, National Bureau of Economic Research, Inc.
- Paul Ekins & Stefan Speck, 1999. "Competitiveness and Exemptions From Environmental Taxes in Europe," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 13(4), pages 369-396, June.
- Christopher R. Knittel, 2012.
"Reducing Petroleum Consumption from Transportation,"
Journal of Economic Perspectives,
American Economic Association, vol. 26(1), pages 93-118, Winter.
- Christopher R. Knittel, 2012. "Reducing Petroleum Consumption from Transportation," NBER Working Papers 17724, National Bureau of Economic Research, Inc.
- Markussen, Peter & Svendsen, Gert Tinggaard, 2005. "Industry lobbying and the political economy of GHG trade in the European Union," Energy Policy, Elsevier, vol. 33(2), pages 245-255, January.
- Davis, Lucas W. & Muehlegger, Erich, 2010.
"Do Americans Consume Too Little Natural Gas? An Empirical Test Of Marginal Cost Pricing,"
- Lucas W. Davis & Erich Muehlegger, 2010. "Do Americans consume too little natural gas? An empirical test of marginal cost pricing," RAND Journal of Economics, RAND Corporation, vol. 41(4), pages 791-810.
- Lucas W. Davis & Erich Muehlegger, 2010. "Do Americans Consume Too Little Natural Gas? An Empirical Test of Marginal Cost Pricing," NBER Working Papers 15885, National Bureau of Economic Research, Inc.
- Bovenberg, A. Lans & Goulder, Lawrence H. & Jacobsen, Mark R., 2008.
"Costs of alternative environmental policy instruments in the presence of industry compensation requirements,"
Journal of Public Economics,
Elsevier, vol. 92(5-6), pages 1236-1253, June.
- Bovenberg, A.L. & Goulder, L.H. & Jacobson, M.R., 2006. "Costs of Alternative Environmental Policy Instruments in the Presence of Industry Compensation Requirements," Discussion Paper 2006-127, Tilburg University, Center for Economic Research.
- Stavins, Robert, 2004.
"Introduction to the Political Economy of Environmental Regulations,"
dp-04-12, Resources For the Future.
- Stavins, Robert, 2004. "Introduction to the Political Economy of Environmental Regulation," Working Paper Series rwp04-004, Harvard University, John F. Kennedy School of Government.
- Yu-Bong Lai, 2008. "Auctions or grandfathering: the political economy of tradable emission permits," Public Choice, Springer, vol. 136(1), pages 181-200, July.
- Goulder, Lawrence H. & Parry, Ian W. H. & Williams III, Roberton C. & Burtraw, Dallas, 1999.
"The cost-effectiveness of alternative instruments for environmental protection in a second-best setting,"
Journal of Public Economics,
Elsevier, vol. 72(3), pages 329-360, June.
- Lawrence H. Goulder & Ian W. H. Parry & Roberton C. Williams III & Dallas Burtraw, 1998. "The Cost-Effectiveness of Alternative Instruments for Environmental Protection in a Second-Best Setting," NBER Working Papers 6464, National Bureau of Economic Research, Inc.
- Burtraw, Dallas & Parry, Ian & Goulder, Lawrence & Williams III, Roberton, 1998. "The Cost-Effectiveness of Alternative Instruments for Environmental Protection in a Second-Best Setting," Discussion Papers dp-98-22, Resources For the Future.
- Nordhaus William D, 2010. "Carbon Taxes to Move Toward Fiscal Sustainability," The Economists' Voice, De Gruyter, vol. 7(3), pages 1-5, September.
- Anthony Downs, 1957. "An Economic Theory of Political Action in a Democracy," Journal of Political Economy, University of Chicago Press, vol. 65, pages 135.
- Nicolas Marceau & Michael Smart, 2002.
"Corporate Lobbying and Commitment Failure in Capital Taxation,"
CESifo Working Paper Series
676, CESifo Group Munich.
- Nicolas Marceau & Michael Smart, 2003. "Corporate Lobbying and Commitment Failure in Capital Taxation," American Economic Review, American Economic Association, vol. 93(1), pages 241-251, March.
- Bombardini, Matilde, 2008. "Firm heterogeneity and lobby participation," Journal of International Economics, Elsevier, vol. 75(2), pages 329-348, July.
- Nathaniel O. Keohane, 2009. "Cap and Trade, Rehabilitated: Using Tradable Permits to Control U.S. Greenhouse Gases," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 3(1), pages 42-62, Winter.
- Aidt, Toke S., 1998. "Political internalization of economic externalities and environmental policy," Journal of Public Economics, Elsevier, vol. 69(1), pages 1-16, July.
- Robert W. Hahn, 2009. "Greenhouse Gas Auctions and Taxes: Some Political Economy Considerations," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 3(2), pages 167-188, Summer.
- Bernheim, B Douglas & Whinston, Michael D, 1986. "Menu Auctions, Resource Allocation, and Economic Influence," The Quarterly Journal of Economics, MIT Press, vol. 101(1), pages 1-31, February.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Julio Saavedra).
If references are entirely missing, you can add them using this form.