Arbeitspapier

Is there a green paradox?

A sufficiently rapidly rising carbon tax may increase near-term emissions compared with the case of no carbon tax. Even so, such a carbon tax path may reduce total costs related to climate change, since the tax may reduce total carbon extraction. A government cannot commit to a specific carbon tax rate in the distant future. For reasonable assumptions about expectation formation, a higher present carbon tax will reduce near-term carbon emissions. Moreover, whatever the expectations about future tax rates are, near-term emissions will decline for a sufficiently high carbon tax. However, if the nearterm tax rate for some reason is set below its optimal level, increased concern for the climate may change taxes in a manner that increases near-term emissions.

Language
Englisch

Bibliographic citation
Series: Memorandum ; No. 2010,13

Classification
Wirtschaft
Nonrenewable Resources and Conservation: Demand and Supply; Prices
Nonrenewable Resources and Conservation: Government Policy
Energy: Demand and Supply; Prices
Energy: Government Policy
Climate; Natural Disasters and Their Management; Global Warming
Environmental Economics: Government Policy
Subject
Climate change
exhaustible resources
green paradox
carbon tax
Klimaschutz
Erschöpfbare Ressourcen
Ökosteuer
Kohlendioxid
Umweltpolitik
Theorie

Event
Geistige Schöpfung
(who)
Hoel, Michael
Event
Veröffentlichung
(who)
University of Oslo, Department of Economics
(where)
Oslo
(when)
2010

Handle
Last update
10.03.2025, 11:43 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Hoel, Michael
  • University of Oslo, Department of Economics

Time of origin

  • 2010

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