Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/172973
Authors: 
Daubanes, Julien Xavier
Henriet, Fanny
Schubert, Katheline
Year of Publication: 
2017
Series/Report no.: 
CESifo Working Paper 6697
Abstract: 
We examine an open economy’s strategy to reduce its carbon emissions by replacing its consumption of coal—very carbon intensive—with gas—less so. Unlike the standard analysis of carbon leakage, unilateral carbon-reduction policies with more than one carbon energy source may turn counter-productive, ultimately increasing world emissions. Thus, we establish testable conditions as to whether a governmental emission-reduction commitment warrants the exploitation of gas, and whether such a strategy increases global emissions. We also characterize the extent to which this unilateral policy makes the rest of the world’s emission commitments more difficult to meet. Finally, we apply our results to the case of the US.
Subjects: 
unilateral climate policy
carbon emission reduction
shale gas
gas-coal substitution
coal exports
carbon leakage
US policy
counter-productive policy
JEL: 
Q41
Q58
H73
F18
Document Type: 
Working Paper

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