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Curbing emissions through (efficient) carbon liabilities: A note from a climate skeptic's perspective

Author

Listed:
  • Billette de Villemeur, Etienne
  • Leroux, Justin

Abstract

We propose a new climate policy that is efficient, robust, and asks for payments proportional to realized climate damage. In each period, countries are made liable for their share of the responsibility in the current damage. Efficiency follows from countries' anticipations of climate change, hence of future payments. Robustness is achieved thanks to the introduction of a market for carbon liabilities. Rather than being based on the expected discounted sum of future marginal damage (as with a carbon tax or tradable emission permits) our proposal relies only on observed realized damage and on the well-documented emission history of countries.

Suggested Citation

  • Billette de Villemeur, Etienne & Leroux, Justin, 2013. "Curbing emissions through (efficient) carbon liabilities: A note from a climate skeptic's perspective," MPRA Paper 46953, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:46953
    as

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    File URL: https://mpra.ub.uni-muenchen.de/53601/9/MPRA_paper_53601.pdf
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    References listed on IDEAS

    as
    1. Etienne Billette de Villemeur & Justin Leroux, 2011. "Sharing the Cost of Global Warming," Scandinavian Journal of Economics, Wiley Blackwell, vol. 113(4), pages 758-783, December.
    2. Kolstad, Charles D & Ulen, Thomas S & Johnson, Gary V, 1990. "Ex Post Liability for Harm vs. Ex Ante Safety Regulation: Substitutes or Complements?," American Economic Review, American Economic Association, vol. 80(4), pages 888-901, September.
    3. Etienne Billette de Villemeur & Justin Leroux, 2011. "Sharing the Cost of Global Warming," Scandinavian Journal of Economics, Wiley Blackwell, vol. 113(4), pages 758-783, December.
    4. Steven Shavell, 2011. "Corrective Taxation versus Liability," American Economic Review, American Economic Association, vol. 101(3), pages 273-276, May.
    5. Hammond, Peter J, 1981. "Ex-ante and Ex-post Welfare Optimality under Uncertainty," Economica, London School of Economics and Political Science, vol. 48(191), pages 235-250, August.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Climate Change; Ex-ante vs ex-post approach; Carbon Liability;
    All these keywords.

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • K13 - Law and Economics - - Basic Areas of Law - - - Tort Law and Product Liability; Forensic Economics
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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