Climate policies in a second-best world- a case study on India
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.
|Date of creation:||2010|
|Date of revision:|
|Publication status:||Published, Energy Policy, 2010, 38, 3, 1519-1528|
|Note:||View the original document on HAL open archive server: http://halshs.archives-ouvertes.fr/halshs-00724498|
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