The Green Paradox: A Supply-side View of the Climate Problem

Hans-Werner Sinn

No 5385, CESifo Working Paper Series from CESifo

Abstract: Why have policies aimed at reducing the demand for carbon not succeeded in slowing down global carbon extraction and CO2 emissions, and why have carbon prices failed to increase over the last three decades? This comment argues that this is because of the Green Paradox, i.e. – (the anticipation of sales by resource owners who try to pre-empt the destruction of their markets by green policies.) – Reviewing some of the conditions under which strong and weak versions of the Green Paradox may emerge, it is argued that there is little hope that green replacement technologies will impose hard price constraints that would keep long-run extraction within a fixed carbon budget and that, therefore, even strong versions of the paradox cannot easily be avoided.

Keywords: carbon; environmentalism; back stop; oil prices (search for similar items in EconPapers)
JEL-codes: H23 O13 Q32 Q54 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_5385

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