How Much Carbon Pricing is in Countries' Own Interests? The Critical Role of Co-Benefits
By Ian W. H. Parry, Chandara Veung, D. Heine. Social Science Research Network, 2014
168 citations recorded by the source corpus.
This paper calculates, for the top 20 emitting countries, how much pricing of carbon dioxide (CO2) emissions would be in their own national interests due to domestic co-benefits (leaving aside the global climate benefits). On average, second-best domestic prices are substantial, $57.5 per ton of CO2 (for year 2010), reflecting primarily health co-benefits from reduced air pollution at coal plants and, in some cases, reductions in automobile externalities net of fuel taxes/subsidies. Pricing co-benefits reduces CO2 emissions from the top 20 emitters by 13.5%. However, co-benefits vary dramatically across countries (e.g., with population exposure to pollution) and differentiated pricing of CO2 emissions therefore yields higher net benefits (by 23%) than uniform pricing. Importantly, the efficiency case for pricing carbon’s co-benefits hinges critically on weak prospects (for the foreseeable future) for comprehensive internalization of other externalities through other (more efficient) pricing instruments.
Subfields: Economics and Econometrics, Renewable Energy, Sustainability and the Environment
View Paper: https://www.semanticscholar.org/paper/3b28c8a952ee528504deb75882e7a0adb53f7a67
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In Economics and Econometrics
- S. Carattini
- A. Baranzini
- Jordi Roca
- Emilio Padilla
- Richard B. Howarth
- Jeroen C. J. M. van den Bergh
- Mònica Serrano
- Richard Wood
In Renewable Energy, Sustainability and the Environment
- S. Carattini
- Jordi Roca
- Richard B. Howarth
- Jeroen C. J. M. van den Bergh
- A. Baranzini
- Richard Wood
- Edgar G. Hertwich
Citations in the corpus
- Carbon pricing in climate policy: seven reasons, complementary instruments, and political economy considerations (2017, background): “A relatively high carbon price, up to 63$ per ton of CO2-equivalent in the case of China, could be justified based only on local co-benefits, that is, without accounting for climate benefits.(91) The authors find that even for the United States, a carbon price of more than 30$ per ton of CO2-equival”