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Climate policy commitment devices

Sebastian Dengler, Reyer Gerlagh, Stefan Trautmann and Gijs Kuilen

Journal of Environmental Economics and Management, 2018, vol. 92, issue C, 331-343

Abstract: We develop a dynamic resource extraction game that mimics the global multi-generation planning problem for climate change and fossil fuel extraction. We implement the game under different conditions in the laboratory. Compared to a baseline condition, we find that policy interventions that provide a costly commitment device or reduce climate threshold uncertainty reduce resource extraction. We also study two conditions to assess the underlying social preferences and the viability of ecological dictatorship. Our results suggest that climate change policies that focus on investments that lock the economy into carbon-free energy sources provide an important commitment device in the intertemporal cooperation problem.

Keywords: Climate policy instruments; Intertemporal cooperation; Climate game; Experiments (search for similar items in EconPapers)
JEL-codes: C91 D62 D99 Q38 Q54 (search for similar items in EconPapers)
Date: 2018
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Related works:
Working Paper: Climate Policy Commitment Devices (2017) Downloads
Working Paper: Climate Policy Commitment Devices (2017) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeeman:v:92:y:2018:i:c:p:331-343

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Journal of Environmental Economics and Management is currently edited by M.A. Cole, A. Lange, D.J. Phaneuf, D. Popp, M.J. Roberts, M.D. Smith, C. Timmins, Q. Weninger and A.J. Yates

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