Carbon Prices for the Next Thousand Years

Reyer Gerlagh

Review of Environment, Energy and Economics - Re3, 2012

Abstract: As changes in climate-related stocks have consequences spanning over centuries or possibly millennia to the future, to reconcile the discounting of such far-distant impacts and realism of the shorter-term decisions, hyperbolic time-preferences are considered in a climate-economy model. The results justify high carbon taxes as advocated by Stern while maintaining the realism of the macroeconomic outcome, thus providing a solution for the dilemma centering the carbon tax-discount rate debate.

Keywords: Carbon Tax; Discounting; Climate Change; Inconsistent Preferences (search for similar items in EconPapers)
JEL-codes: D61 D91 E21 H41 H43 Q54 (search for similar items in EconPapers)
Date: 2012
References: Add references at CitEc
Citations: View citations in EconPapers (44)

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Working Paper: Carbon Prices for the Next Thousand Years (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:fem:femre3:2012.08-03

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