Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/70932 
Year of Publication: 
2013
Series/Report no.: 
CESifo Working Paper No. 4147
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
That climate policies are costly is evident and therefore often creates major fears. But the alternative (no action) also has a cost. Mitigation costs and damages incurred depend on what the climate policies are; moreover, they are substitutes. This brings climate policies naturally in the realm of benefit-cost analysis. In this paper we illustrate the direct cost components of various policies, and then confront them with the benefits generated, that is, the damage cost avoided. However, the sheer benefit-cost criterion is not a sufficient incentive to induce cooperation among countries, a necessary condition for an effective global climate policy. Thus, we also explore how to use this criterion in the context of international climate cooperation.
Subjects: 
climate policy
integrated assessment
cost-benefit analysis
climate cooperation
JEL: 
Q54
H87
D61
D90
F42
Q20
Document Type: 
Working Paper
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