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Mitigation and adaptation are not enough: turning to emissions reduction abroad

Author

Listed:
  • Alain Ayong Le Kama

    () (EconomiX, Université Paris Ouest-Nanterre la Défense)

  • Aude Pommeret

    () (SEE, City University of Hong Kong and IREGE Université de Savoie)

Abstract

In this paper we focus on a long-term dynamic analysis of the optimal adaptation/mitigation mix in the presence of a pollution threshold above which adaptation is no longer efficient. We account for accumulation in abatement capital, greenhouse gases, and adaptation capital in order to better capture the arbitrage between abatement and adaptation investments. Pollution damages arise from the emissions due to the country consumption but also from the emissions of the rest of the world (ROW). A pollution threshold is then introduced, above which adaptation is no longer efficient. We obtain that if this threshold is lower than the steady-state level of pollution, there is no way for the modeled economy to avoid it. In particular, such a situation will appear if the ROW?s emissions are high. Next step is then to introduce another type of investment allowing for lower ROW pollution ie. emissions reduction abroad through CDM for instance. We obtain that CDM may be a means to avoid a pollution threshold above which adaptation becomes of no use.

Suggested Citation

  • Alain Ayong Le Kama & Aude Pommeret, 2016. "Mitigation and adaptation are not enough: turning to emissions reduction abroad," Working Papers 2016.01, FAERE - French Association of Environmental and Resource Economists.
  • Handle: RePEc:fae:wpaper:2016.01
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    File URL: http://faere.fr/pub/WorkingPapers/Pommeret_Ayong%20Le%20Kama_FAERE_WP2016.01.pdf
    File Function: First version, 2016
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    Cited by:

    1. Can Askan Mavi, 2016. "Uncertain Catastrophic Events : Another Source of Environmental Traps ?," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-01275174, HAL.

    More about this item

    Keywords

    climate change; mitigation; adaptation; CDM; pollution threshold;

    JEL classification:

    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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