SELFISH BUREAUCRATS AND POLICY HETEROGENEITY IN NORDHAUS’ DICE
Richard Tol ()
Climate Change Economics (CCE), 2020, vol. 11, issue 04, 1-16
Nordhaus’ seminal DICE model assesses first-best climate policy, a useful but unrealistic yardstick. I propose a measure of policy inefficacy if carbon prices are heterogeneous and use observed prices to recalibrate the DICE model. I introduce a Niskanen-inspired model of climate policy with selfish bureaucrats, and calibrate it to carbon dioxide emissions in the European Union and the policy models used by the IPCC. This model also implies a measure of policy inefficacy that I use to recalibrate DICE. The optimal global mean temperature is 1∘C perhaps 2∘C higher in the recalibrated than in the original DICE model.
Keywords: Climate policy; price heterogeneity; selfish bureaucrats (search for similar items in EconPapers)
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Chapter: SELFISH BUREAUCRATS AND POLICY HETEROGENEITY IN NORDHAUS’ DICE (2021)
Working Paper: Selfish Bureaucrats and Policy Heterogeneity in Nordhaus’ DICE (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:wsi:ccexxx:v:11:y:2020:i:04:n:s2010007820400060
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