Do Carbon Offsets Offset Carbon?

Raphael Calel, Jonathan Colmer, Antoine Dechezleprêtre and Matthieu Glachant

American Economic Journal: Applied Economics, 2025, vol. 17, issue 1, 1-40

Abstract: We develop and implement a new method for identifying wasted subsidies and use it to provide systematic evidence of the misallocation of carbon offsets in the Clean Development Mechanism—the world's largest carbon offset program. Using newly constructed data on the locations and characteristics of over 1,000 wind farms in India, we estimate that at least 52 percent of approved carbon offsets were allocated to projects that would very likely have been built anyway. We estimate that the sale of these offsets to regulated polluters resulted in substantially higher global carbon dioxide emissions.

JEL-codes: H23 O13 Q42 Q54 Q58 (search for similar items in EconPapers)
Date: 2025
References: View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.aeaweb.org/doi/10.1257/app.20230052 (application/pdf)
https://doi.org/10.3886/E195621V1 (text/html)
https://www.aeaweb.org/doi/10.1257/app.20230052.appx (application/pdf)
https://www.aeaweb.org/doi/10.1257/app.20230052.ds (application/zip)
Access to full text is restricted to AEA members and institutional subscribers.

Related works:
Working Paper: Do Carbon Offsets Offset Carbon? (2025)
Working Paper: Do carbon offsets offset carbon? (2021)
Working Paper: Do Carbon Offsets Offset Carbon? (2021)
Working Paper: Do carbon offsets offset carbon? (2021)
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:aea:aejapp:v:17:y:2025:i:1:p:1-40

Ordering information: This journal article can be ordered from
https://www.aeaweb.org/journals/subscriptions

DOI: 10.1257/app.20230052

Access Statistics for this article

American Economic Journal: Applied Economics is currently edited by Alexandre Mas

More articles in American Economic Journal: Applied Economics from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().