On the Design of Global Refunding and Climate Change

Hans Gersbach and Ralph Winkler

No 6379, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We design a global refunding scheme as a new international approach to address climate change. A global refunding system allows each country to set its carbon emission tax, while aggregate tax revenues are partially refunded to member countries in proportion to the relative emission reductions they achieve within a given period, compared to some given baseline emissions. In a simple model we show that a suitably designed global refunding scheme is self-enforcing and achieves the social global optimum.

Keywords: Climate change mitigation; Global refunding scheme; International agreements; Self-enforcing mechanisms (search for similar items in EconPapers)
JEL-codes: H23 H41 Q54 (search for similar items in EconPapers)
Date: 2007-07
New Economics Papers: this item is included in nep-ene, nep-env and nep-pbe
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Citations: View citations in EconPapers (18)

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Working Paper: On the Design of Global Refunding and Climate Change (2007)
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