Can lobbying encourage abatement? Designing a new policy instrument

Ian Lange and Sarah Polborn

No 2012-03, Stirling Economics Discussion Papers from University of Stirling, Division of Economics

Abstract: Taking a political economy perspective this paper proposes an alternative carbon abatement policy instrument with significant cant advantages over existing policy instruments. The key feature of the proposed carbon securities is that they entitle their owners to a fi xed proportion of ex ante unknown total emis-sions. The total level of carbon emissions is set by the political process after the carbon securities have been sold. A key benefit of the proposed carbon security is that it creates a group of stakeholders, whose interest is for a smaller level of emissions and which competes with industries that consume signifi cant amounts of carbon-based energy. The advantages over existing policy tools include an equilibrium carbon price closer to the level preferred by voters and a more predictable environmental policy in the presence of either climate or political uncertainty. (JEL: D72, Q54, Q58)

Keywords: Lobbying; climate policy (search for similar items in EconPapers)
Date: 2012-03
New Economics Papers: this item is included in nep-cdm, nep-ene, nep-env and nep-pol
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http://hdl.handle.net/1893/3722

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Working Paper: Can Lobbying Encourage Abatement? Designing a New Policy Instrument (2012)
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