Global Unanimity Agreement on the Carbon Budget

John Roemer and Humberto Llavador

No 1084, Working Papers from Barcelona School of Economics

Abstract: Carbon budgets are a useful way to frame the climate mitigation challenge and much easier to agree upon than the allocation of emissions. We propose a mechanism with countries agreeing on the global carbon budget, while the decision to emit is decentralized at the country level. The revenue is collected in a global fund and allocated according to endogenously defined 10 weights proportional to the marginal cost of climate change. The proposal features a unanimous agreement of the national citizenries of the world and global Pareto efficiency. We run a simulation in the spirit of the Paris Agreement, with zero emissions after 2055. At the Global Unanimity Equilibrium, permits are priced at 90$/tC, yielding 1.3 trillion dollars annually. Africa, India and the less developed countries in Asia are the only net recipients, while the US 15 and China are the largest net contributors.

Keywords: climate change; carbon budget; emissions; international agreement; permits (search for similar items in EconPapers)
JEL-codes: F53 F64 Q54 Q56 Q58 (search for similar items in EconPapers)
Date: 2019-04
New Economics Papers: this item is included in nep-ene, nep-env and nep-sea
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://bw.bse.eu/wp-content/uploads/2019/04/1084-file.pdf (application/pdf)

Related works:
Working Paper: Global unanimity agreement on the carbon budget (2022)
Working Paper: Global unanimity agreement on the carbon budget (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bge:wpaper:1084

Access Statistics for this paper

More papers in Working Papers from Barcelona School of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Bruno Guallar ().