Simple Rules for Climate Policy and Integrated Assessment
Frederick (Rick) van der Ploeg () and
No 213, OxCarre Working Papers from Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford
A simple integrated assessment framework that gives rules for the optimal carbon price, transition to the carbon-free era and stranded carbon assets is presented, which highlights the ethical, economic, geophysical and political drivers of optimal climate policy. For the ethics we discuss the role of intergenerational inequality aversion and the discount rate, where we show the importance of lower discount rates for appraisal of longer run benefit and of policy makers using lower discount rates than private agents. The economics depends on the costs and rates of technical progress in production of fossil fuel, its substitute renewable energies and sequestration. The geophysics depends on the permanent and transient components of atmospheric carbon and the relatively fast temperature response, and we allow for positive feedbacks. The politics stems from international free-rider problems in absence of a global climate deal. We show how results change if different assumptions are made about each of the drivers of climate policy. Our main objective is to offer an easy back-on-the-envelope analysis, which can be used for teaching and communication with policy makers.
Keywords: simple rules; climate policy; ethics; economics; geophysics; politics; discounting with declining discount rates; positive feedback; free riding (search for similar items in EconPapers)
JEL-codes: D81 H20 Q31 Q38 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ene and nep-env
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
https://www.economics.ox.ac.uk/materials/OxCarre/R ... oxcarrerp2018213.pdf (application/pdf)
Journal Article: Simple Rules for Climate Policy and Integrated Assessment (2019)
Working Paper: Simple Rules for Climate Policy and Integrated Assessment (2018)
Working Paper: Simple rules for climate policy and integrated assessment (2018)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:oxf:oxcrwp:213
Access Statistics for this paper
More papers in OxCarre Working Papers from Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford Contact information at EDIRC.
Bibliographic data for series maintained by Melis Boya ().