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Monitoring and Enforcement of Climate Policy

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Author Info

  • Hilary Sigman

    ()
    (Rutgers University and NBER)

Abstract

This paper applies recent research on environmental enforcement to a potential U.S. program to control greenhouse gases, especially through emission trading. Climate policies present the novel problem of integrating emissions reductions that are relatively easy to monitor (such as carbon dioxide emissions from fossil fuels) with those that may be very difficult to monitor (such as some emissions of other greenhouse gases). The paper documents the heterogeneity in monitoring costs across different parts of current carbon markets. It argues that a broad emission trading system that includes more difficult-to-enforce components can provide less incentive to violate the law than a narrower program; thus, the government may not find it more costly to assure compliance with a broader program.

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File URL: ftp://snde.rutgers.edu/Rutgers/wp/2010-06.pdf
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Bibliographic Info

Paper provided by Rutgers University, Department of Economics in its series Departmental Working Papers with number 201006.

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Length: 20 pages
Date of creation: 04 Aug 2010
Date of revision:
Publication status: Forthcoming in "The Design and Implementation of U.S. Climate Policy," D. Fullerton and C. Wolfram, eds. University of Chicago Press.
Handle: RePEc:rut:rutres:201006

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Related research

Keywords: Environmental Economics; Climate Change; Public Enforcement of Law;

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References

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  1. Marc N. Conte & Matthew J. Kotchen, 2009. "Explaining the Price of Voluntary Carbon Offsets," NBER Working Papers 15294, National Bureau of Economic Research, Inc.
  2. Severin Borenstein, 2010. "Markets for Anthropogenic Carbon Within the Larger Carbon Cycle," NBER Working Papers 16104, National Bureau of Economic Research, Inc.
  3. James B. Bushnell, 2010. "The Economics of Carbon Offsets," NBER Working Papers 16305, National Bureau of Economic Research, Inc.
  4. Montero, Juan-Pablo, 2002. "Prices versus quantities with incomplete enforcement," Journal of Public Economics, Elsevier, vol. 85(3), pages 435-454, September.
  5. Ellerman,A. Denny & Joskow,Paul L. & Schmalensee,Richard & Montero,Juan-Pablo & Bailey,Elizabeth M., 2005. "Markets for Clean Air," Cambridge Books, Cambridge University Press, number 9780521023894, October.
    • Ellerman,A. Denny & Joskow,Paul L. & Schmalensee,Richard & Montero,Juan-Pablo & Bailey,Elizabeth M., 2000. "Markets for Clean Air," Cambridge Books, Cambridge University Press, number 9780521660839, October.
  6. Gary S. Becker, 1974. "Crime and Punishment: An Economic Approach," NBER Chapters, in: Essays in the Economics of Crime and Punishment, pages 1-54 National Bureau of Economic Research, Inc.
  7. A. Denny Ellerman & Nick Johnstone & Friedrich Schneider & Alexander F. Wagner & Juan-Pablo Montero & Johann Wackerbauer, 2003. "Tradable Permits," CESifo Forum, Ifo Institute for Economic Research at the University of Munich, vol. 4(1), pages 3-32, October.
  8. Bruce Mizrach, 2009. "Integration of the Global Emissions Trading Markets," Departmental Working Papers 200901, Rutgers University, Department of Economics.
  9. repec:att:wimass:9610 is not listed on IDEAS
  10. James Andreoni & Brian Erard & Jonathan Feinstein, 1998. "Tax Compliance," Journal of Economic Literature, American Economic Association, vol. 36(2), pages 818-860, June.
  11. Sandeep Kapur, 2009. "An Economic Model of Whistle-Blower Policy," Journal of Law, Economics and Organization, Oxford University Press, vol. 25(1), pages 157-182, May.
  12. Harford, Jon D., 1978. "Firm behavior under imperfectly enforceable pollution standards and taxes," Journal of Environmental Economics and Management, Elsevier, vol. 5(1), pages 26-43, March.
  13. Ellerman,A. Denny & Convery,Frank J. & de Perthuis,Christian With contributions by-Name:Alberola,Emilie With contributions by-Name:Buchner,Barbara K. With contributions by-Name:Delbosc,Anaïs, 2010. "Pricing Carbon," Cambridge Books, Cambridge University Press, number 9780521196475, October.
  14. Stranlund, John K. & Dhanda, Kanwalroop Kathy, 1999. "Endogenous Monitoring and Enforcement of a Transferable Emissions Permit System," Journal of Environmental Economics and Management, Elsevier, vol. 38(3), pages 267-282, November.
  15. Pizer, William & Kruger, Joseph, 2004. "The EU Emissions Trading Directive: Opportunities and Potential Pitfalls," Discussion Papers dp-04-24, Resources For the Future.
  16. Malik, Arun S., 1990. "Markets for pollution control when firms are noncompliant," Journal of Environmental Economics and Management, Elsevier, vol. 18(2), pages 97-106, March.
  17. De Perthuis, Christian & Convery, Frank J. & Ellerman, Denny, 2010. "Pricing carbon : the European Union Emissions Trading Scheme," Economics Papers from University Paris Dauphine 123456789/10174, Paris Dauphine University.
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Citations

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Cited by:
  1. Alessio D’Amato & Edilio Valentini, 2011. "Enforcement and environmental quality in a decentralized emission trading system," Journal of Regulatory Economics, Springer, vol. 40(2), pages 141-159, October.
  2. Hilary Sigman & Howard F. Chang, 2011. "The Effect of Allowing Pollution Offsets with Imperfect Enforcement," American Economic Review, American Economic Association, vol. 101(3), pages 268-72, May.

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