Carbon prices for the next hundred years

Thumbnail Image

Access rights

openAccess
acceptedVersion

URL

Journal Title

Journal ISSN

Volume Title

A1 Alkuperäisartikkeli tieteellisessä aikakauslehdessä
This publication is imported from Aalto University research portal.
View publication in the Research portal (opens in new window)
View/Open full text file from the Research portal (opens in new window)

Authors

Date

2018-03

Department

Department of Economics

Major/Subject

Mcode

Degree programme

Language

en

Pages

30

Series

Economic Journal, Volume 128, issue 609, pp. 728–757

Abstract

This paper examines the socially optimal pricing of carbon emissions over time when climate-change impacts are unknown, potentially high-consequence events. The carbon price tends to increase with income. But learning about impacts, or their absence, decouples the carbon price from income growth. The price should grow faster than the economy if the past warming is not substantial enough for learning the true long-run social cost. It grows slower than the economy as soon as the warming generates information about events that could have arrived but have not done so. A quantitative assessment shows that the price grows roughly at the rate of the economy for the next 100 years.

Description

Keywords

Other note

DOI

10.1111/ecoj.12436

Citation

Gerlagh, R & Liski, M 2018, 'Carbon prices for the next hundred years', Economic Journal, vol. 128, no. 609, 10.1111/ecoj.12436, pp. 728–757 . https://doi.org/10.1111/ecoj.12436

Permanent link to this item

https://urn.fi/URN:NBN:fi:aalto-201701191340

Collections

[article-cris] Kauppakorkeakoulu / BIZ