ON INTERNATIONAL EQUITY WEIGHTS AND NATIONAL DECISION MAKING ON CLIMATE CHANGE

David Anthoff and Richard S.J. Tol ()

No FNU-127, Working Papers from Research unit Sustainability and Global Change, Hamburg University

Abstract: Estimates of the marginal damage costs of carbon dioxide emissions require the aggregation of monetised impacts of climate change over people with different incomes and in different jurisdictions. Implicitly or explicitly, such estimates assume a social welfare function and hence a particular attitude towards equity and justice. We show that previous approaches to equity weighing are inappropriate from a national decision maker’s point of view, because domestic impacts are not valued at domestic values. We propose four alternatives (sovereignty, altruism, good neighbour, and compensation) with different views on concern for and liability towards foreigners. The four alternatives imply radically estimates of the social cost of carbon and hence the optimal intensity of climate policy.

Keywords: Domestic climate policy; social cost of carbon; equity weights (search for similar items in EconPapers)
JEL-codes: Q54 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ene, nep-env and nep-tur
Date: 2007-02
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http://www.fnu.zmaw.de/fileadmin/fnu-files/publica ... lequityweightswp.pdf First version, 2007 (application/pdf)

Related works:
Working Paper: On International Equity Weights and National Decision Making on Climate Change (2007)
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