Can lobbying encourage abatement? Designing a new policy instrument
Taking a political economy perspective this paper proposes an alternative carbon abatement policy instrument with significant cant advantages over existing policy instruments. The key feature of the proposed carbon securities is that they entitle their owners to a fi xed proportion of ex ante unknown total emis-sions. The total level of carbon emissions is set by the political process after the carbon securities have been sold. A key benefit of the proposed carbon security is that it creates a group of stakeholders, whose interest is for a smaller level of emissions and which competes with industries that consume signifi cant amounts of carbon-based energy. The advantages over existing policy tools include an equilibrium carbon price closer to the level preferred by voters and a more predictable environmental policy in the presence of either climate or political uncertainty. (JEL: D72, Q54, Q58)
|Date of creation:||Mar 2012|
|Date of revision:|
|Contact details of provider:|| Postal: Division of Economics, University of Stirling, Stirling, Scotland FK9 4LA|
Phone: +44 (0)1786 467473
Fax: +44 (0)1786 467469
Web page: http://www.econ.stir.ac.uk/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Goulder, Lawrence H. & Parry, Ian W. H. & Williams III, Roberton C. & Burtraw, Dallas, 1999.
"The cost-effectiveness of alternative instruments for environmental protection in a second-best setting,"
Journal of Public Economics,
Elsevier, vol. 72(3), pages 329-360, June.
- Burtraw, Dallas & Parry, Ian & Goulder, Lawrence & Williams III, Roberton, 1998. "The Cost-Effectiveness of Alternative Instruments for Environmental Protection in a Second-Best Setting," Discussion Papers dp-98-22, Resources For the Future.
- Lawrence H. Goulder & Ian W. H. Parry & Roberton C. Williams III & Dallas Burtraw, 1998. "The Cost-Effectiveness of Alternative Instruments for Environmental Protection in a Second-Best Setting," NBER Working Papers 6464, National Bureau of Economic Research, Inc.
- B. Douglas Bernheim & Michael D. Whinston, 1986. "Menu Auctions, Resource Allocation, and Economic Influence," The Quarterly Journal of Economics, Oxford University Press, vol. 101(1), pages 1-31.
- Oates, Wallace E. & Portney, Paul R., 2003.
"The political economy of environmental policy,"
Handbook of Environmental Economics,
in: K. G. Mäler & J. R. Vincent (ed.), Handbook of Environmental Economics, edition 1, volume 1, chapter 8, pages 325-354
- Nicolas Marceau & Michael Smart, 2003.
"Corporate Lobbying and Commitment Failure in Capital Taxation,"
American Economic Review,
American Economic Association, vol. 93(1), pages 241-251, March.
- Nicolas Marceau & Michael Smart, 2002. "Corporate Lobbying and Commitment Failure in Capital Taxation," CESifo Working Paper Series 676, CESifo Group Munich.
- Christopher R. Knittel, 2012.
"Reducing Petroleum Consumption from Transportation,"
NBER Working Papers
17724, National Bureau of Economic Research, Inc.
- Christopher R. Knittel, 2012. "Reducing Petroleum Consumption from Transportation," Journal of Economic Perspectives, American Economic Association, vol. 26(1), pages 93-118, Winter.
- Markussen, Peter & Svendsen, Gert Tinggaard, 2005. "Industry lobbying and the political economy of GHG trade in the European Union," Energy Policy, Elsevier, vol. 33(2), pages 245-255, January.
- Lucas W. Davis & Erich Muehlegger, 2010.
"Do Americans consume too little natural gas? An empirical test of marginal cost pricing,"
RAND Journal of Economics,
RAND Corporation, vol. 41(4), pages 791-810.
- Lucas W. Davis & Erich Muehlegger, 2010. "Do Americans Consume Too Little Natural Gas? An Empirical Test of Marginal Cost Pricing," NBER Working Papers 15885, National Bureau of Economic Research, Inc.
- Bombardini, Matilde, 2008. "Firm heterogeneity and lobby participation," Journal of International Economics, Elsevier, vol. 75(2), pages 329-348, July.
- Hanley, Nicholas & Mackenzie, Ian A, 2010.
"The effects of rent seeking over tradable pollution permits,"
Stirling Economics Discussion Papers
2010-02, University of Stirling, Division of Economics.
- Hanley Nick & MacKenzie Ian A, 2010. "The Effects of Rent Seeking over Tradable Pollution Permits," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(1), pages 1-26, July.
- Nick Hanley & Ian A. MacKenzie, 2009. "The effects of rent seeking over tradable pollution permits," CER-ETH Economics working paper series 09/112, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
- Hanley, Nicholas & Mackenzie, Ian A, 2009. "The effects of rent seeking over tradable pollution permits," Stirling Economics Discussion Papers 2009-12, University of Stirling, Division of Economics.
- Yu-Bong Lai, 2008. "Auctions or grandfathering: the political economy of tradable emission permits," Public Choice, Springer, vol. 136(1), pages 181-200, July.
- Robert W. Hahn, 2009. "Greenhouse Gas Auctions and Taxes: Some Political Economy Considerations," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 3(2), pages 167-188, Summer.
- Bovenberg, A.L. & Goulder, L.H. & Jacobson, M.R., 2006.
"Costs of Alternative Environmental Policy Instruments in the Presence of Industry Compensation Requirements,"
2006-127, Tilburg University, Center for Economic Research.
- Bovenberg, A. Lans & Goulder, Lawrence H. & Jacobsen, Mark R., 2008. "Costs of alternative environmental policy instruments in the presence of industry compensation requirements," Journal of Public Economics, Elsevier, vol. 92(5-6), pages 1236-1253, June.
- Aidt, Toke S., 1998. "Political internalization of economic externalities and environmental policy," Journal of Public Economics, Elsevier, vol. 69(1), pages 1-16, July.
- William R. Kerr & William F. Lincoln & Prachi Mishra, 2014.
"The Dynamics of Firm Lobbying,"
William Davidson Institute Working Papers Series
wp1072, William Davidson Institute at the University of Michigan.
- Paul Ekins & Stefan Speck, 1999. "Competitiveness and Exemptions From Environmental Taxes in Europe," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 13(4), pages 369-396, June.
- Stavins, Robert, 2004.
"Introduction to the Political Economy of Environmental Regulation,"
Working Paper Series
rwp04-004, Harvard University, John F. Kennedy School of Government.
- Stavins, Robert, 2004. "Introduction to the Political Economy of Environmental Regulations," Discussion Papers dp-04-12, Resources For the Future.
- Nathaniel O. Keohane, 2009. "Cap and Trade, Rehabilitated: Using Tradable Permits to Control U.S. Greenhouse Gases," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 3(1), pages 42-62, Winter.
- Anthony Downs, 1957. "An Economic Theory of Political Action in a Democracy," Journal of Political Economy, University of Chicago Press, vol. 65, pages 135.
- Nordhaus William D, 2010. "Carbon Taxes to Move Toward Fiscal Sustainability," The Economists' Voice, De Gruyter, vol. 7(3), pages 1-5, September.
When requesting a correction, please mention this item's handle: RePEc:stl:stledp:2012-03. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Liam Delaney)
If references are entirely missing, you can add them using this form.