Efficiency Gains from "What"-Flexibility in Climate Policy: An Integrated CGE Assessment
AbstractWe investigate the importance of ?what?-flexibility on top of ?where?- and ?when?-flexibility for alternative emission control schemes that prescribe long-term temperature targets and eventually impose additional constraints on the rate of temperature change. We find that ?what?-flexibility substantially reduces the compliance costs under alternative emission control schemes. When comparing policies that simply involve long-term temperature targets against more stringent strategies that include additional constraints on the rate of temperature increase, it turns out that the latter involve huge additional costs. These costs may be interpreted as additional insurance payments if damages should not only dependent on absolute temperature change but also on the rate of temperature change. --
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Bibliographic InfoPaper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 04-48.
Date of creation: 2004
Date of revision:
Climate policy; Integrated Assessment; What-flexibility;
Other versions of this item:
- Christoph Bohringer, Andreas Loschel and Thomas F. Rutherford, 2006. "Efficiency Gains from "What"-Flexibility in Climate Policy An Integrated CGE Assessment," The Energy Journal, International Association for Energy Economics, vol. 0(Special I), pages 405-424.
- Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
- D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
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