November 15, 2010

What Are the Costs of Meeting Distributional Objectives for Climate Policy?

by Ian W.H. Parry and Roberton C. Williams III

- This paper develops an analytical model to quantify the costs and distributional effects of various fiscal options for allocating the (large) rents created under prospective cap-and-trade programs to reduce domestic, energy-related CO2 emissions. The trade-off between cost effectiveness and distribution is striking.

Parry, I.W.H. and R.C. Williams III (2010). "What Are the Costs of Meeting Distributional Objectives for Climate Policy?" NBER Working Paper No. 16486, Oct 2010.