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Climate policies in a second-best world- a case study on India

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  • Sandrine Mathy

    () (CIRED - Centre International de Recherche sur l'Environnement et le Développement - CIRAD - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique)

  • Céline Guivarch

    () (CIRED - Centre International de Recherche sur l'Environnement et le Développement - CIRAD - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique)

Abstract

The aim of this article is to analyze the potential for synergies between climate policies and development in a case study on India focusing on the power sector sub-optimalities. To do so, we use IMACLIM-R, a dynamic recursive energy-economy model that represents a second best world with market imperfections and short-run adjustments constraints along a long-term growth path. The analysis suggests (i) global carbon pricing induces prohibitive macroeconomic costs for the Indian economy, even in the case of significant financial transfers associated with a global cap-and-trade system and a "Contraction and Convergence in 2100" allocation scheme; (ii) the most cost efficient climate policies are not uniform carbon pricing only. The implementation of domestic policies suited to the national context, for instance targeting sub-optimalities in the power sector for India, allows reducing significantly the macroeconomic costs induced by international mitigation policies.

Suggested Citation

  • Sandrine Mathy & Céline Guivarch, 2010. "Climate policies in a second-best world- a case study on India," Post-Print halshs-00724498, HAL.
  • Handle: RePEc:hal:journl:halshs-00724498
    DOI: 10.1016/j.enpol.2009.11.035
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00724498
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Emanuele Massetti, 2011. "Carbon tax scenarios for China and India: exploring politically feasible mitigation goals," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 11(3), pages 209-227, September.
    2. Rao, Narasimha D., 2013. "Distributional impacts of climate change mitigation in Indian electricity: The influence of governance," Energy Policy, Elsevier, vol. 61(C), pages 1344-1356.
    3. repec:eee:eneeco:v:64:y:2017:i:c:p:530-541 is not listed on IDEAS
    4. Elmar Kriegler & Brian-C O'Neill & Stéphane Hallegatte & Tom Kram & Richard-H Moss & Robert Lempert & Thomas J Wilbanks, 2010. "Socio-economic Scenario Development for Climate Change Analysis," Working Papers hal-00866437, HAL.
    5. Kimmich, Christian & Sagebiel, Julian, 2016. "Empowering irrigation: A game-theoretic approach to electricity utilization in Indian agriculture," Utilities Policy, Elsevier, vol. 43(PB), pages 174-185.
    6. Vaibhav Chaturvedi & Priyadarshi Shukla, 2014. "Role of energy efficiency in climate change mitigation policy for India: assessment of co-benefits and opportunities within an integrated assessment modeling framework," Climatic Change, Springer, vol. 123(3), pages 597-609, April.
    7. Céline Guivarch & Sandrine Mathy, 2012. "Energy-GDP decoupling in a second best world—a case study on India," Climatic Change, Springer, vol. 113(2), pages 339-356, July.
    8. Guivarch, Céline & Monjon, Stéphanie, 2017. "Identifying the main uncertainty drivers of energy security in a low-carbon world: The case of Europe," Energy Economics, Elsevier, vol. 64(C), pages 530-541.
    9. Meriem Hamdi-Cherif & Céline Guivarch & Philippe Quirion, 2011. "Sectoral targets for developing countries: combining 'common but differentiated re-sponsibilities' with 'meaningful participation'," Climate Policy, Taylor & Francis Journals, vol. 11(1), pages 731-751, January.
    10. Elmar Kriegler & Brian-C O'Neill & Stéphane Hallegatte & Tom Kram & Richard-H Moss & Robert Lempert & Thomas J Wilbanks, 2010. "Socio-economic Scenario Development for Climate Change Analysis," CIRED Working Papers hal-00866437, HAL.
    11. Tol, Richard S.J., 2017. "The structure of the climate debate," Energy Policy, Elsevier, vol. 104(C), pages 431-438.
    12. Neil Strachan & Will Usher, 2012. "Failure to achieve stringent carbon reduction targets in a second-best policy world," Climatic Change, Springer, vol. 113(2), pages 121-139, July.
    13. Gambhir, Ajay & Napp, Tamaryn A. & Emmott, Christopher J.M. & Anandarajah, Gabrial, 2014. "India's CO2 emissions pathways to 2050: Energy system, economic and fossil fuel impacts with and without carbon permit trading," Energy, Elsevier, vol. 77(C), pages 791-801.

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