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Journal of Economic Perspectives: Vol. 7 No. 4 (Fall 1993)

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Global Warming Policy: A Public Finance Perspective

Article Citation

Poterba, James M. 1993. "Global Warming Policy: A Public Finance Perspective." Journal of Economic Perspectives, 7(4): 47-63.

DOI: 10.1257/jep.7.4.47

Abstract

In the last few years, a substantial volume of research has considered the design of taxes to slow greenhouse gas emissions as well as the economic effects of such policies. In this paper, I summarize the insights that have emerged from this work. I begin by explaining that while efficiency considerations create a presumption for using coordinated international policies to alter greenhouse gas emissions, the prospects for such action are bleak. Then I focus on the public finance of carbon taxes at the national level, considering the design of such taxes as well as their incidence across and within nations. Next, I focus on greenhouse gas emission policies that could be enacted in less-developed countries, such as the elimination of fossil fuel subsidies and other policies to slow deforestation. Finally I suggest several promising directions for future study.

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Authors

Poterba, James M. (MIT and NBER)

JEL Classifications

Q28: Renewable Resources and Conservation: Government Policy

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