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Climate Policy after 2012

Author

Listed:
  • Valentina Bosetti
  • Carlo Carraro
  • Massimo Tavoni

Abstract

Discussion over post-2012 climate policy is now entering a crucial phase. Despite the potential great risks of prolonged global warming, the success of an international climate stabilization agreement hinges to a great extent on its economic feasibility. This article makes precise the assumptions that underpin current mainstream estimates of the costs of controlling climate change and provides quantitative estimates of cost differentials under different scenarios. In particular, the article analyses the role of three utmost factors in the economic cost of a climate treaty: energy technology development; the participation rate of developing countries; and the timing of global action. We show that all three factors have a major impact on policy macroeconomic costs. Addressing them effectively is therefore indispensable in ensuring the feasibility of any international agreement to control global warming. Therefore, we propose a series of policy recommendations that can help addressing the issues of technology, timing and participation, and that represent key policy implications for a post-2012 climate policy. (JEL codes: C72, H23, Q25, Q28) Copyright The Author 2009. Published by Oxford University Press on behalf of Ifo Institute for Economic Research, Munich. All rights reserved. For permissions, please email: journals.permissions@oxfordjournals.org, Oxford University Press.

Suggested Citation

  • Valentina Bosetti & Carlo Carraro & Massimo Tavoni, 2009. "Climate Policy after 2012," CESifo Economic Studies, CESifo, vol. 55(2), pages 235-254, June.
  • Handle: RePEc:oup:cesifo:v:55:y:2009:i:2:p:235-254
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    File URL: http://hdl.handle.net/10.1093/cesifo/ifp007
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    Citations

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    Cited by:

    1. Valentina Bosetti & Carlo Carraro & Massimo Tavoni, 2012. "Timing of Mitigation and Technology Availability in Achieving a Low-Carbon World," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 51(3), pages 353-369, March.
    2. Gersbach, Hans & Hummel, Noemi, 2016. "A development-compatible refunding scheme for a climate treaty," Resource and Energy Economics, Elsevier, vol. 44(C), pages 139-168.
    3. Carlo Carraro & Johan Eyckmans & Michael Finus, 2006. "Optimal transfers and participation decisions in international environmental agreements," The Review of International Organizations, Springer, vol. 1(4), pages 379-396, December.
    4. De Cian, Enrica & Tavoni, Massimo, 2012. "Do technology externalities justify restrictions on emission permit trading?," Resource and Energy Economics, Elsevier, vol. 34(4), pages 624-646.
    5. Massimo Tavoni & Enrica Cian & Gunnar Luderer & Jan Steckel & Henri Waisman, 2012. "The value of technology and of its evolution towards a low carbon economy," Climatic Change, Springer, vol. 114(1), pages 39-57, September.
    6. Bosello, Francesco & Carraro, Carlo & De Cian, Enrica, 2013. "Adaptation can help mitigation: an integrated approach to post-2012 climate policy," Environment and Development Economics, Cambridge University Press, vol. 18(03), pages 270-290, June.
    7. Alice Favero & Enrica De Cian, 2010. "Fairness, Credibility and Effectiveness in the Copenhagen Accord: An Economic Assessment," Working Papers 2010.21, Fondazione Eni Enrico Mattei.
    8. CARRARO Carlo & MASSETTI Emanuele & NICITA Lea, 2010. "How Does Climate Policy Affect Technical Change? ?An Analysis of the Direction and Pace of Technical Progress in a Climate-Economy Model (Fondazione Eni Enrico Mattei)," ESRI Discussion paper series 229, Economic and Social Research Institute (ESRI).
    9. Lee Lane & W. Montgomery, 2014. "An institutional critique of new climate scenarios," Climatic Change, Springer, vol. 122(3), pages 447-458, February.
    10. Gersbach, Hans & Hummel, Noemi, 2011. "Climate Policy and Developing Countries," CEPR Discussion Papers 8685, C.E.P.R. Discussion Papers.
    11. Bosetti, Valentina, 2011. "Comment," Energy Economics, Elsevier, vol. 33(4), pages 632-633, July.
    12. Eom, Jiyong & Edmonds, Jae & Krey, Volker & Johnson, Nils & Longden, Thomas & Luderer, Gunnar & Riahi, Keywan & Van Vuuren, Detlef P., 2015. "The impact of near-term climate policy choices on technology and emission transition pathways," Technological Forecasting and Social Change, Elsevier, vol. 90(PA), pages 73-88.
    13. Hans Gersbach & Noemi Hummel, 2009. "Climate Policy and Development," CESifo Working Paper Series 2807, CESifo Group Munich.
    14. Enrica De Cian & Fabio Sferra & Massimo Tavoni, 2013. "The Influence of Economic Growth, Population, and Fossil Fuel Scarcity on Energy Investments," Working Papers 2013.59, Fondazione Eni Enrico Mattei.

    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy

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