The costs of climate policies in a second-best world with labour market imperfections

Guivarch, Céline; Crassous, Renaud; Sassi, Olivier; Hallegatte, Stéphane

doi:10.3763/cpol.2009.0012

Cited by 49 publications

(28 citation statements)

References 41 publications

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“…134). In some cases, climate policy could even lead to welfare losses if an already internalized externality was over corrected (34) or interacted with preexisting inefficiencies in a welfare-degrading way (135,136; also cf. literature on the double dividend, e.g., 137,138).…”

Section: Critical Discussion Of Policy Costs and Welfare Effects In Imentioning

confidence: 99%

Integrating Global Climate Change Mitigation Goals with Other Sustainability Objectives: A Synthesis

Stechow

McCollum

Riahi

et al. 2015

Annu. Rev. Environ. Resour.

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Achieving a truly sustainable energy transition requires progress across multiple dimensions beyond climate change mitigation goals. This article reviews and synthesizes results from disparate strands of literature on the coeffects of mitigation to inform climate policy choices at different governance levels. The literature documents many potential cobenefits of mitigation for nonclimate objectives, such as human health and energy security, but little is known about their overall welfare implications. Integrated model studies highlight that climate policies as part of well-designed policy packages reduce the overall cost of achieving multiple sustainability objectives. The incommensurability and uncertainties around the quantification of coeffects become, however, increasingly pervasive the more the perspective shifts from sectoral and local to economy wide and global, the more objectives are analyzed, and the more the results are expressed in economic rather than nonmonetary terms. Different strings of evidence highlight the role and importance of energy demand reductions for realizing synergies across multiple sustainability objectives.

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Section: Critical Discussion Of Policy Costs and Welfare Effects In Imentioning

confidence: 99%

Integrating Global Climate Change Mitigation Goals with Other Sustainability Objectives: A Synthesis

Stechow

McCollum

Riahi

et al. 2015

Annu. Rev. Environ. Resour.

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“…This model has been used in several peer-reviewed articles in recent years: cf. Crassous et al (2006), Guivarch et al (2009Guivarch et al ( , 2010, Hamdi-Cherif et al (2010), Mathy and Guivarch (2010), Rozenberg et al (2010) and Sassi et al (2010).…”

Section: Introductionmentioning

confidence: 99%

How Co2 Capture and Storage Can Mitigate Carbon Leakage

et al. 2011

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SummaryMost CO 2 abatement policies reduce the demand for fossil fuels and therefore their price in international markets. If these policies are not global, this price decrease raises emissions in countries without CO 2 abatement policies, generating "carbon leakage". On the other hand, if the countries which abate CO 2 emissions are net fossil fuel importers, they benefit from this price decrease, which reduces the abatement cost. In contrast, CO 2 capture and storage (CCS) does not reduce fossil fuel demand, therefore it generates neither this type of leakage nor this negative feedback on abatement costs. We quantify these effects with the global hybrid general equilibrium model Imaclim-R and show that they are quantitatively important. Indeed, for a given unilateral abatement in OECD countries, leakage is more than halved in a scenario with CCS included among the abatement options, compared to a scenario prohibiting CCS. We show that the main reason for this difference in leakage is the above-mentioned international fossil fuel price feedback. This article does not intend to assess the desirability of CCS, which has many other pros and cons. It just identifies a consequence of CCS that should be taken into account, together with many others, when deciding to what extent CCS should be developed. Most CO 2 abatement policies reduce the demand for fossil fuels and therefore their price in international markets. If these policies are not global, this price decrease raises emissions in countries without CO 2 abatement policies, generating "carbon leakage". On the other hand, if the countries which abate CO 2 emissions are net fossil fuel importers, they benefit from this price decrease, which reduces the abatement cost. In contrast, CO 2 capture and storage (CCS) does not reduce fossil fuel demand, therefore it generates neither this type of leakage nor this negative feedback on abatement costs. We quantify these effects with the global hybrid general equilibrium model Imaclim-R and show that they are quantitatively important. Indeed, for a given unilateral abatement in OECD countries, leakage is more than halved in a scenario with CCS included among the abatement options, compared to a scenario prohibiting CCS. We show that the main reason for this difference in leakage is the above-mentioned international fossil fuel price feedback. This article does not intend to assess the desirability of CCS, which has many other pros and cons. It just identifies a consequence of CCS that should be taken into account, together with many others, when deciding to what extent CCS should be developed. Keywords

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“…in energy and labor markets. Babiker and Eckaus (2007) and Guivarch et al (2011) show that taking into account unemployment and friction in labor market adjustments can change in a significant way the assessment of mitigation costs. In developing countries in particular, existing economic distortions cannot be disregarded in the design of climate policies.…”

Section: Defining Shared Climate Policy Assumptionsmentioning

confidence: 99%

A new scenario framework for climate change research: the concept of shared climate policy assumptions

et al. 2014

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The new scenario framework facilitates the coupling of multiple socioeconomic reference pathways with climate model products using the representative concentration pathways. This will allow for improved assessment of climate impacts, adaptation and mitigation. Assumptions about climate policy play a major role in linking socioeconomic futures with forcing and climate outcomes. The paper presents the concept of shared climate policy assumptions as an important element of the new scenario framework. Shared climate policy assumptions capture key policy attributes such as the goals, instruments and obstacles of mitigation and adaptation measures, and introduce an important additional dimension to

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The costs of climate policies in a second-best world with labour market imperfections

Cited by 49 publications

References 41 publications

Integrating Global Climate Change Mitigation Goals with Other Sustainability Objectives: A Synthesis

Integrating Global Climate Change Mitigation Goals with Other Sustainability Objectives: A Synthesis

How Co2 Capture and Storage Can Mitigate Carbon Leakage

A new scenario framework for climate change research: the concept of shared climate policy assumptions

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