Fridays for Future meets the Hotelling rule: some thoughts on decarbonization policies
Markus Pasche ()
MPRA Paper from University Library of Munich, Germany
The Hotelling rule is applied to the case of a fixed CO2 budget restriction which has to be met in order to reach the global warming goal according to the Paris Agreement. While the theoretical result is well-known and simple, the practical implementation under technological uncertainty suggests that tradable emission certificates are superior to CO2 taxes. The practical implementaion has also to consider that production chains are globalized, and that decarbonization strategies will be pointless if the Global South is not part of it.
Keywords: climate change; CO2 reduction, Hotelling rule, CO2 taxes, emission trading system, globalization (search for similar items in EconPapers)
JEL-codes: O30 Q30 Q37 Q38 Q54 Q58 (search for similar items in EconPapers)
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