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on Energy Economics |
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Issue of 2011‒01‒30
twenty-two papers chosen by Roger Fouquet Basque Climate Change Centre, Bilbao, Spain |
| By: | Krupnick, Alan (Resources for the Future); Campbell, Sarah; Cohen, Mark, A. (Resources for the Future); Parry, Ian W.H. (Resources for the Future) |
| Abstract: | The purpose of this paper is to provide a conceptual framework for understanding how analysis of costs and benefits might be incorporated into an assessment of regulatory policies affecting deepwater drilling. We begin by providing a framework for analyzing the life-cycle impacts of oil drilling and its alternatives, including onshore drilling and importing oil from abroad. We then provide background estimates of the different sources of oil supplied in the United States, look at how other oil supply sources might respond to regulations on deepwater drilling, and consider the economic costs of these regulations. After providing a comprehensive description of the potential costs and benefits from various types of drilling—including, when possible, estimates of the magnitude of these benefits and costs—we discuss the extent to which these costs and benefits may already be taken into account (or reinforced) through the legal, regulatory, and tax systems and through market mechanisms. We conclude by presenting a framework and simple example of how a cost–benefit analysis might be used to inform regulation of deepwater drilling, and sum up the policy implications of our work. |
| Keywords: | catastrophic oil spill, cost-benefit analysis, government regulation, liability |
| Date: | 2011–01–12 |
| URL: | http://d.repec.org/n?u=RePEc:rff:dpaper:dp-10-62&r=ene |
| By: | Muehlenbachs, Lucija (Resources for the Future); Cohen, Mark A. (Resources for the Future); Gerarden, Todd (Resources for the Future) |
| Abstract: | This paper reports on a preliminary analysis of performance indicators on 3,020 platforms operating in the Gulf of Mexico between 1996 and 2010. Statistical analysis reveals that company-reported incidents (such as blowouts, fires, injuries, and pollution) increase with water depth, controlling for platform characteristics such as age, quantity of oil and gas produced, and number of producing wells. In addition to company-reported incidents, we examine government inspections and the type of enforcement action (warning, component shut-in, facility shut-in, or civil penalty review) following an inspection. Fewer incidents of noncompliance are detected during inspections on deepwater platforms compared with shallow-water platforms; however, the magnitude of the effect of depth on noncompliance is not large. We provide a preliminary analysis of the effect of prior findings of noncompliance, suggesting that noncompliance is persistent. We also find significant variability in both self-reported incidents and noncompliance across leaseholders. |
| Keywords: | noncompliance, inspection, offshore oil and gas |
| JEL: | Q50 |
| Date: | 2011–01–12 |
| URL: | http://d.repec.org/n?u=RePEc:rff:dpaper:dp-10-66&r=ene |
| By: | Anderson, Robert; Cohen, Mark A. (Resources for the Future); Macauley, Molly K. (Resources for the Future); Richardson, Nathan (Resources for the Future); Stern, Adam (Resources for the Future) |
| Abstract: | The Deepwater Horizon oil spill in the Gulf of Mexico in April 2010 led to the deaths of 11 workers, a six-month moratorium on deepwater drilling in the Gulf, and nearly three months of massive engineering and logistics efforts to stop the spill. The series of failures before the well was finally capped and the spill contained revealed an inability to deal effectively with a well in deepwater and ultradeepwater. Ensuring that containment capabilities are adequate for drilling operations at these depths is therefore a salient challenge for government and industry. In this paper we assess the Marine Well Containment Company (MWCC), a consortium aimed at designing and building a system capable of containing future deepwater spills in the Gulf. We also consider alternatives for long-term readiness for deepwater spill containment. We focus on the roles of liability and regulation as determinants of readiness and the adequacy of incentives for technological innovation in oil spill containment technology to keep pace with advances in deepwater drilling capability. Liability and regulation can significantly influence the strength of these incentives. In addition, we discuss appropriate governance structure as a major determinant of the effectiveness of MWCC. |
| Keywords: | oil spill, containment, industry R&D, liability, regulation, governance, innovation |
| JEL: | Q4 Q55 K3 |
| Date: | 2011–01–12 |
| URL: | http://d.repec.org/n?u=RePEc:rff:dpaper:dp-10-63&r=ene |
| By: | Cooke, Roger M. (Resources for the Future); Ross, Heather L. (Resources for the Future); Stern, Adam (Resources for the Future) |
| Abstract: | The Oil Spill Commission’s chartered mission—to “develop options to guard against … any oil spills associated with offshore drilling in the future” (National Commission 2010)—presents a major challenge: how to reduce the risk of low-frequency oil spill events, and especially high-consequence events like the Deepwater Horizon accident, when historical experience contains few oil spills of material scale and none approaching the significance of the Deepwater Horizon. In this paper, we consider precursor analysis as an answer to this challenge, addressing first its development and use in nuclear reactor regulation and then its applicability to offshore oil and gas drilling. We find that the nature of offshore drilling risks, the operating information obtainable by the regulator, and the learning curve provided by 30 years of nuclear experience make precursor analysis a promising option available to the U.S. Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) to bring cost-effective, risk-informed oversight to bear on the threat of catastrophic oil spills. |
| Keywords: | catastrophic oil spills, quantitative risk analysis, risk-informed regulation |
| Date: | 2011–01–12 |
| URL: | http://d.repec.org/n?u=RePEc:rff:dpaper:dp-10-61&r=ene |
| By: | Cohen, Mark A. (Resources for the Future); Gottlieb, Madeline (Resources for the Future); Linn, Joshua (Resources for the Future); Richardson, Nathan (Resources for the Future) |
| Abstract: | Although the causes of the Deepwater Horizon spill are not yet conclusively identified, significant attention has focused on the safety-related policies and practices—often referred to as the safety culture—of BP and other firms involved in drilling the well. This paper defines and characterizes the economic and policy forces that affect safety culture and identifies reasons why those forces may or may not be adequate or effective from the public’s perspective. Two potential justifications for policy intervention are that: a) not all of the social costs of a spill may be internalized by a firm; and b) there may be principal-agency problems within the firm, which could be reduced by external monitoring. The paper discusses five policies that could increase safety culture and monitoring: liability, financial responsibility (a requirement that a firm’s assets exceed a threshold), government oversight, mandatory private insurance, and risk-based drilling fees. We find that although each policy has a positive effect on safety culture, there are important differences and interactions that must be considered. In particular, the latter three provide external monitoring. Furthermore, raising liability caps without mandating insurance or raising financial responsibility requirements could have a small effect on the safety culture of small firms that would declare bankruptcy in the event of a large spill. The paper concludes with policy recommendations for promoting stronger safety culture in offshore drilling; our preferred approach would be to set a liability cap for each well equal to the worst-case social costs of a spill, and to require insurance up to the cap. |
| Keywords: | Deepwater Horizon, BP oil spill, safety culture, government policy, liability caps, financial responsibility, insurance |
| Date: | 2011–01–12 |
| URL: | http://d.repec.org/n?u=RePEc:rff:dpaper:dp-10-65&r=ene |
| By: | Mutuc, Maria; Pan, Suwen; Hudson, Darren |
| Abstract: | Selected Paper prepared for presentation at the Southern Agricultural Economics Association Annual Meeting, Orlando, FL, February 6-9, 2010 |
| Keywords: | Cotton, oil price, demand shocks, supply shocks, structural vector autoregression, Demand and Price Analysis, Industrial Organization, |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:ags:ttudco:96675&r=ene |
| By: | Kessides, Ioannis N.; Wade, David C. |
| Abstract: | This paper complements previous work on the economics of different energy resources by examining the growth potential of alternative electricity supply infrastructures as constrained by innate physical limits. Coal-fired generation meets the criteria of longevity (abundance of energy source) and scalability (effective capability to expand to the multi-terawatt level) which are critical for a sustainable energy supply chain, but it carries a very heavy carbon footprint. Renewables and nuclear power meet both the longevity and climate friendliness criteria. However, they vary in terms of their ability to deliver net energy at a scale needed for meeting a huge global energy demand. The low density of renewable resources for electricity generation and the current intermittency of many renewables limit their ability to achieve high rates of growth. And a significant global increase in nuclear power deployment could engender serious risks related to proliferation, safety, and waste disposal. Unlike renewable sources of energy, nuclear power is an unforgiving technology because human lapses and errors can have ecological and social impacts that are catastrophic and irreversible. The transition to a low carbon economy is likely to prove much more challenging than some optimists have claimed. |
| Keywords: | Energy Production and Transportation,Climate Change Mitigation and Green House Gases,Energy and Environment,Environment and Energy Efficiency,Energy Demand |
| Date: | 2011–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5539&r=ene |
| By: | Nagl, Stephan (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Fürsch, Michaela (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Paulus, Moritz (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Richter, Jan (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Trueby, Johannes (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Lindenberger, Dietmar (Energiewirtschaftliches Institut an der Universitaet zu Koeln) |
| Abstract: | In this working paper we demonstrate how challenging greenhouse gas reduction targets of up to 95% until 2050 can be achieved in the German electricity sector. In the analysis, we focus on the main requirements to reach such challenging targets. To account for interdependencies between the electricity market and the rest of the economy, different models were used to account for feedback loops with all other sectors. <p> We include scenarios with different runtimes and retrofit costs for existing nuclear plants to determine the effects of a prolongation of nuclear power plants in Germany. <p> Key findings for the electricity sector include the importance of a European-wide coordinated electricity grid extension and the exploitation of regional comparative cost effects for renewable sites. Due to political restrictions, nuclear energy will not be available in Germany in 2050. However, the nuclear life time extension has a positive impact on end consumer electricity prices as well as economic growth in the medium term, if retrofit costs do not exceed certain limits. |
| Keywords: | Roadmap 2050; GHG reduction; renewable energies; carbon capture and storage; power plant fleet optimization |
| JEL: | C61 Q40 |
| Date: | 2010–12–30 |
| URL: | http://d.repec.org/n?u=RePEc:ris:ewikln:2010_006&r=ene |
| By: | Coenen, Lars (CIRCLE, Lund University); Suurs , Roald (TNO Built Environment); van Sandick , Emma (TNO Built Environment) |
| Abstract: | To speed up the transformation to low-carbon energy systems, transition policy approaches highlight the importance of purposive experimentation with sustainable niche technologies. An important policy challenge that has followed from various ‘real’ transition experiments concerns the crucial issue of ‘upscaling’ or ‘aggregating’ the niche technologies towards broader and more widespread application in society. To address the question ‘which policy mix supports the upscaling of emergent niche technologies in a transition to sustainable energy systems?’ the paper adopts a comparative approach. Two successful cases where upscaling of emergent technology niches has taken place are contrasted with an unsuccesful fail case. The success cases entail the emergence and diffusion of bioenergy and biofuels in Sweden as well as windpower in Denmark whereas the fail case consists of biofuels in the Netherlands. |
| Keywords: | sustainability transitions; niche technologies; technological innovation systems |
| JEL: | O30 |
| Date: | 2011–01–20 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lucirc:2010_017&r=ene |
| By: | Klier, Thomas; Linn, Joshua (Resources for the Future) |
| Abstract: | This paper presents an overview of the economics literature on the effect of Corporate Average Fuel Economy (CAFE) standards on the new vehicle market. Since 1978, CAFE has imposed fuel economy standards for cars and light trucks sold in the U.S. market. This paper reviews the history of the standards, followed by a discussion of the major upcoming changes in implementation and stringency. It describes strategies that firms can use to meet the standards and reviews the CAFE literature as it applies to the new vehicle market. The paper concludes by highlighting areas for future research in light of the upcoming changes to CAFE. |
| Keywords: | CAFE, costs, structural estimation |
| Date: | 2010–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:rff:dpaper:dp-10-68&r=ene |
| By: | Fischer, Carolyn (Resources for the Future) |
| Abstract: | This study explores the role of market power on the cost-effectiveness of policies to address fuel consumption. Market power gives manufacturers an incentive to under- (over-) provide fuel economy in classes whose consumers, on average, value it less (more) than in others. Adding a second market failure in consumer valuation of fuel economy, a policy trade-off emerges. Minimum standards can address distortions from price discrimination but, unlike average standards, do not provide broad-based incentives for improving fuel economy. Increasing fuel prices raises demand for fuel economy but exacerbates undervaluation and incentives for price discrimination. A combination policy may be preferred. For modelers of fuel economy policy, failure to capture consumer heterogeneity in preferences for fuel economy can lead to significant errors in predicting the distribution of effort in complying with regulation, as well as the calculation and distribution of the benefits. |
| Keywords: | fuel economy, regulation, imperfect competition, price discrimination |
| JEL: | D4 L62 Q5 |
| Date: | 2010–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:rff:dpaper:dp-10-60&r=ene |
| By: | Dieckhoener, Caroline (Energiewirtschaftliches Institut an der Universitaet zu Koeln) |
| Abstract: | Due to the increasing European import dependency, significant additional natural gas volumes will be required. In addition to the Nord Stream pipeline, the Nabucco and South Stream pipeline are projects planned for the next decade to provide further gas supplies to the European market. <p> As one of the European Union’s energy policies’ foci is security of supply, the question can be raised if and how these projects contribute to this objective not only in terms of diversification but also in case of supply disruptions such as occurred in 2009 during the Russia-Ukraine gas crisis. <p> This paper discusses the impact of these two major gas import pipeline projects on the South-Eastern Europe gas supply and analyzes their effects on gas flows and marginal cost prices in general and in case of gas supply disruptions via Ukraine in a model-based analysis with the European natural gas infrastructure and dispatch model TIGER. |
| Keywords: | Natural gas; security of supply; Nabucco; South Stream; Europe; linear-optimization; transport infrastructure |
| JEL: | C61 L95 Q34 Q41 |
| Date: | 2010–12–27 |
| URL: | http://d.repec.org/n?u=RePEc:ris:ewikln:2010_007&r=ene |
| By: | Leahy, Eimear; Tol, Richard S. J. |
| Abstract: | This paper estimates the value of short term lost load in the all island electricity market which includes the Republic of Ireland and Northern Ireland. The value of lost load, also known as the value of security of electricity supply, is inferred using a production function approach. Detailed electricity use data for the Republic of Ireland allows us to estimate the value of lost load by time of day, time of week and type of user. We find that the value of lost load is highest in the residential sector in both the Republic of Ireland and Northern Ireland. Our results can be used to advise policy decisions in the case of supply outages and to encourage optimum supply security. In the context of this study short term is taken to be a matter of hours rather than days or weeks. |
| Keywords: | Ireland/value of lost load/electricity/Republic of Ireland/data/US/Policy |
| Date: | 2010–10 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp357&r=ene |
| By: | Wang, Limin; Bandyopadhyay, Sushenjit; Cosgrove-Davies, Mac; Samad, Hussain |
| Abstract: | Scaling-up adoption of renewable energy technology, such as solar home systems, to expand electricity access in developing countries can accelerate the transition to low-carbon economic development. Using a purposely collected national household survey, this study quantifies the carbon and distributional benefits of solar home system programs in Bangladesh. Three key findings are generated from the study. First, dissemination of solar home systems brings about significant carbon benefits: the total carbon emissions avoided from replacing kerosene use for lighting by solar home systems in non-electrified rural households was equivalent to about 4 percent of total annual carbon emissions in Bangladesh in 2007. This figure increases to about 15 percent if the grid-electricity generation is used as the energy baseline to estimate the carbon avoided from the installation of solar home systems. Second, solar home system subsidies in rural Bangladesh are progressive when the program is geographically targeted. Third, there exists a market potential for solar home systems in many rural areas if micro-credit schemes are made available and the propensity to install solar home systems is very responsive to income, with a 1-percent increase in per capita income increasing the probability of installing solar home systems by 12 percent, controlling for other factors. |
| Keywords: | Climate Change Mitigation and Green House Gases,Energy Production and Transportation,Access to Finance,Environment and Energy Efficiency,Energy and Environment |
| Date: | 2011–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5545&r=ene |
| By: | Palmer, Karen (Resources for the Future); Paul, Anthony (Resources for the Future); Woerman, Matt |
| Abstract: | Three types of policies that are prominent in the federal debate over addressing greenhouse gas emissions in the United States are a cap-and-trade program (CTP) on emissions, a renewable portfolio standard (RPS) for electricity production, and tax credits for renewable electricity producers. Each of these policies would have different consequences, and combinations of these policies could induce interactions yielding a whole that is not the sum of its parts. This paper utilizes the Haiku electricity market model to evaluate the economic and technology outcomes, climate benefits, and cost-effectiveness of three such policies and all possible combinations of the policies. A central finding is that the carbon dioxide (CO2) emissions reductions from CTP can be significantly greater than those from the other policies, even for similar levels of renewable electricity production, since of the three policies, CTP is the only one that distinguishes electricity generated by coal and natural gas. It follows that CTP is the most cost-effective among these approaches at reducing CO2 emissions. An alternative compliance payment mechanism in an RPS program could substantially affect renewables penetration, and the electricity price effects of the policies hinge partly on the regulatory structure of electricity markets, which varies across the country. |
| Keywords: | renewable portfolio standard, renewable energy credits, cap-and-trade, climate policy |
| JEL: | Q42 Q54 Q58 |
| Date: | 2011–01–12 |
| URL: | http://d.repec.org/n?u=RePEc:rff:dpaper:dp-10-53&r=ene |
| By: | E. Agliardi; L. Sereno |
| Abstract: | The effects of two environmental policy options for the reduction of pollution emissions, i.e. taxes and non-tradable quotas, are analyzed. In contrast to the prior literature this work endogenously takes into account the level of emissions before and after the adoption of the new environmental policy. The level of emissions is determined by solving the firm's profit maximization problem under taxes and fixed quotas. We find that the optimal adoption threshold under taxes is always larger than the adoption threshold under fixed quota, even in a setting characterized by ecological uncertainty and ambiguity - in the form of Choquet-Brownian motions - on future costs and benefits over adopting environmental policies. |
| JEL: | Q28 Q48 L51 H23 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:bol:bodewp:wp725&r=ene |
| By: | Richard Darbéra (LATTS - Laboratoire Techniques, Territoires et Sociétés - CNRS : UMR8134 - Université Paris-Est - Ecole des Ponts ParisTech) |
| Abstract: | La forte fiscalité qui frappe les carburant routiers en France et dans plusieurs pays d'Europe justifierait que ceux-ci soient exemptés de la taxe carbone. En effet, contrairement aux autres taxes internalisantes, la taxe carbone appliquée aux carburants consommés par les ménages a un coût économique supérieur au bénéfice attendu en matière de réduction des émissions. Elle a aussi pour effet d'accentuer le caractère régressif de la taxe intérieure sur les produits pétroliers (TIPP) en frappant plus lourdement les ménages les plus pauvres. Faut-il appliquer la taxe carbone aux carburants routiers ? À notre avis, oui, mais de façon symbolique, c'est à dire en réduisant d'autant la TIPP sur les carburants. C'est la politique qui a été mise en œuvre en Suède, où le poids de la taxe carbone dans le prix d'un litre de carburant a été fixé à une trentaine de centimes sans en affecter le prix parce que les taxes spécifiques qui frappaient les carburants ont été réduites en conséquence lors de l'instauration de la taxe carbone. |
| Keywords: | taxe carbone; tipp; fiscalité; effet redistributif; coin fiscal |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00557065&r=ene |
| By: | Hoel, Michael (Dept. of Economics, University of Oslo); Jensen, Svenn (Ragnar Frisch Centre for Economic Research) |
| Abstract: | We use a two-period model to investigate intertemporal eects of cost reductions in climate change mitigation technologies for the power sector. With imperfect climate policies, cost reductions related to carbon capture and storage (CCS) may be more desirable than comparable cost reductions related to renewable energy. The nding rests on the incentives fossil resource owners face. With regulations of emissions only in the future, cheaper renewables speed up extraction (the `green paradox'), whereas CCS cost reductions make fossil resources more attractive for future use and lead to postponement of extraction. |
| Keywords: | climate change; exhaustible resources; carbon capture and storage; renewable energy; green paradox |
| JEL: | Q30 Q42 Q54 |
| Date: | 2010–11–03 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:osloec:2010_019&r=ene |
| By: | Gary D. Libecap |
| Abstract: | Katharine Coman’s “Some Unsettled Problems of Irrigation,” published in March 1911 in the first issue of the American Economic Review addressed issues of water supply, rights, and organization. These same issues have relevance today 100 years later in face of growing concern about the availability of fresh water worldwide as demand grows and as supplies become more uncertain due to the potential effects of climate change. The central point of this article is that appropriative water rights and irrigation districts that emerged in the American West in the late 19th and early 20th centuries in response to aridity to facilitate agricultural water delivery, use, and trade raise the transaction costs today of water markets. These markets are vital for smooth re-allocation of water to higher-valued uses elsewhere in the economy and for flexible response to greater hydrological uncertainty. This institutional path dependence illustrates how past arrangements to meet conditions of the time constrain contemporary economic opportunities. They cannot be easily significantly modified or replaced ex post. |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:icr:wpicer:33-2010&r=ene |
| By: | Yoshiro Tsutsui (Osaka University and University of Amsterdam) |
| Abstract: | This paper investigates the influence of climate on well-being. While previous studies have compared the well-being of people living in different regions, this study focuses on individuals in one location. It is based on the daily data of 75 students for more than 400 days. Empirical analysis reveals that well-being is maximized at 17.5 degrees Celsius. The effects of the other meteorological variables--humidity, wind speed, sunshine hours, and precipitation--are not significant. However, the influence of temperature is weak and depends on the definition of well-being, a result that may be due to the mild climate of the Osaka region in Japan. |
| Keywords: | global well-being, hedonic well-being, climate, daily web survey, Osaka region |
| JEL: | I31 Q51 Q54 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:osk:wpaper:1101&r=ene |
| By: | Shardul Agrawala; Arnoldo Matus Kramer; Guillaume Prudent-Richard; Marcus Sainsbury |
| Abstract: | National governments and development agencies have invested considerable effort in recent years to develop methodologies and tools to screen their projects for the risks posed by climate change. However, these tools have largely been developed by the climate change community and their application within actual project settings remains quite limited. An alternate and complementary approach would be to examine the feasibility of incorporating consideration of climate change impacts and adaptation within existing modalities for project design, approval, and implementation. Environmental Impact Assessments (EIA) are particularly relevant in this context.<BR>Les administrations nationales et les agences de développement ont consacré un effort considérable ces dernières années à la conception de méthodologies et d’outils d’évaluation de leurs projets du point de vue des risques posés par le changement climatique. Une bonne part de ces instruments ont toutefois été élaborés au sein de la communauté des spécialistes du climat mais sont encore rarement appliqués à des projets concrets. Une autre approche, complémentaire, serait d’étudier la faisabilité de la prise en compte des incidences du changement climatique et de l’adaptation à ce changement dans les modalités existantes de conception, d’approbation et de mise en oeuvre des projets. Les études d’impact sur l’environnement (EIE) sont particulièrement intéressantes à cet égard. |
| Keywords: | climate change, adaptation, risk assessment, environmental impact assessment (EIA), changement climatique, adaptation, évalutation des risques, étude d’impact sur l’environnement (EIE) |
| JEL: | Q51 Q54 Q58 |
| Date: | 2010–08–17 |
| URL: | http://d.repec.org/n?u=RePEc:oec:envaaa:24-en&r=ene |
| By: | Don Fullerton |
| Abstract: | While prior literature has identified various effects of environmental policy, this note uses the example of a proposed carbon permit system to illustrate and discuss six different types of distributional effects: (1) higher prices of carbon-intensive products, (2) changes in relative returns to factors like labor, capital, and resources, (3) allocation of scarcity rents from a restricted number of permits, (4) distribution of the benefits from improvements in environmental quality, (5) temporary effects during the transition, and (6) capitalization of all those effects into prices of land, corporate stock, or house values. The note also discusses whether all six effects could be regressive, that is, whether carbon policy could place disproportionate burden on the poor. |
| JEL: | H23 Q58 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:16703&r=ene |