Konferenzbeitrag
Unilateral mitigation of climate damage via purchase of fossil fuel deposits
In a multi-country model with interconnected markets for fossil fuel and deposits some countries fight climate damage by purchasing and preserving fossil fuel deposits, which would be exploited otherwise. We analyze the effectiveness of such a deposit policy, when that policy stands alone or is combined with fuel cap policies. If the stand-alone deposit policy is non-strategic, it implements the first-best allocation; otherwise, it distorts the allocation in the coalition s favor. Following Harstad (2012), we then analyze the policy mix consisting of the deposit policy, a fuel-supply-cap policy and a fuel-demand-cap policy. The fuel-supply-cap policy turns out to be redundant and so is the fuel-demand-cap policy, if it is nonstrategic. Whenever the coalition acts strategically on one of the markets or on both, it distorts the allocation in its own favor and is better off than in the efficient price-taking scenario which contrasts the efficiency result of Harstad.
- Language
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Englisch
- Bibliographic citation
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Series: Beiträge zur Jahrestagung des Vereins für Socialpolitik 2015: Ökonomische Entwicklung - Theorie und Politik - Session: Environmental Economics IV ; No. D13-V4
- Classification
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Wirtschaft
International Institutional Arrangements
Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
Climate; Natural Disasters and Their Management; Global Warming
- Event
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Geistige Schöpfung
- (who)
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Pethig, Rüdiger
Eichner, Thomas
- Event
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Veröffentlichung
- (when)
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2015
- Handle
- Last update
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10.03.2025, 11:45 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Konferenzbeitrag
Associated
- Pethig, Rüdiger
- Eichner, Thomas
Time of origin
- 2015
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