Non-cooperative and cooperative responses to climate catastrophes in the global economy: a North-South perspective
"The global response to a catastrophic shock to productivity which becomes more imminent with global warming is to have carbon taxes to curb the risk of a calamity and to accumulate precautionary capital to facilitate smoothing of consumption. Our multi-region model of growth and climate change...
| Main Authors: | , |
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| Institution: | ETUI-European Trade Union Institute |
| Format: | TEXT |
| Language: | English |
| Published: |
Oxford
2015
University of Oxford |
| Subjects: | |
| Online Access: | https://www.labourline.org/KENTIKA-19114339124919325119-Non-cooperative-and-cooperativ.htm |
| Summary: | "The global response to a catastrophic shock to productivity which becomes more imminent with global warming is to have carbon taxes to curb the risk of a calamity and to accumulate precautionary capital to facilitate smoothing of consumption. Our multi-region model of growth and climate change indicates that without international lump-sum transfers the cooperative global response to such stochastic tipping points requires converging carbon taxes for developing and developed regions. Non-cooperative responses lead to a bit more precautionary saving and lower diverging carbon taxes. Precautionary capital suffers less from international free-rider problems than the carbon taxes. We illustrate the various outcomes with a calibrated North-South model of the global economy." |
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| Physical Description: | 34 p. Digital |