Erschienen in:CESifo Working Paper Series ; No. 4639
Umfang:
1 Online-Ressource (29 p)
Sprache:
Englisch
DOI:
10.2139/ssrn.2404907
Identifikator:
Entstehung:
Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments February 20, 2014 erstellt
Beschreibung:
This paper explains how, in the context of incomplete coordination among all countries, unilateral policies that might at first sight seem pro-green could actually turn out to harm the global environment. The free-riding motives and the difficulty of reaching an effective international environmental agreement are reviewed. As a first step, the various channels that lead to carbon leakage in static models of open economies are identified, and some simulation results are reported. This is complemented by a review of the possibility of green paradox outcomes in dynamic open-economy models with an exhaustible resource exploited by far-sighted firms. It is shown that border tax adjustments can lead to a green paradox outcome. Directions for future research are suggested