Bitte verwenden Sie diesen Link, um diese Publikation zu zitieren, oder auf sie als Internetquelle zu verweisen: https://hdl.handle.net/10419/282516.2 
Erscheinungsjahr: 
2025
Schriftenreihe/Nr.: 
CESifo Working Paper No. 10828
Versionsangabe: 
This Version: July 2025
Verlag: 
CESifo GmbH, Munich
Zusammenfassung: 
We study clean energy production subsidies in a quantitative climate-economy model. Clean energy production subsidies decrease carbon emissions if and only if they lower the marginal product of dirty energy. The constrained-efficient production subsidy equals the marginal external cost of dirty energy multiplied by the marginal impact of clean energy production on dirty energy production. With standard functional forms, two factors determine the impact of clean energy production subsidies on dirty energy use: the elasticity of substitution between clean and dirty energy and the price elasticity of demand for energy services. With some commonly used parameter values, subsidies on clean energy production increase carbon emissions and decrease welfare relative to laissez faire. With greater substitutability between clean and dirty energy, the production tax credits in the Inflation Reduction Act can generate modest emissions reductions. Even in this more optimistic scenario, a clean energy production subsidy generates significantly higher emissions and lower welfare than a tax on dirty energy.
Schlagwörter: 
Climate Change Mitigation
Second-Best Policies
Economic Growth
JEL: 
H23
O44
Q43
Q54
Dokumentart: 
Working Paper
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2 10419/282516.2 This Version: July 2025
1 10419/282516 Original Version: December 2023

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