On international equity weights and national decision making on climate change

Anthoff, David and Tol, Richard S J (2010) On international equity weights and national decision making on climate change. Journal of Environmental Economics and Management, 60 (1). pp. 14-20. ISSN 0095-0696

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Estimates of the marginal damage costs of carbon dioxide emissions require the aggregation of monetised impacts of climate change over people with different incomes and in different jurisdictions. Implicitly or explicitly, such estimates assume a social welfare function and hence a particular attitude towards equity and justice. We show that previous approaches to equity weighting are inappropriate from a national decision maker's point of view, because domestic impacts are not valued at domestic values. We propose four alternatives (sovereignty, altruism, good neighbour, and compensation) with different views on concern for and liability towards foreigners. The four alternatives imply radically different estimates of the social cost of carbon and hence the optimal intensity of climate policy.

Item Type: Article
Schools and Departments: School of Business, Management and Economics > Economics
Subjects: H Social Sciences > HB Economic theory. Demography
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Depositing User: Richard Tol
Date Deposited: 23 Apr 2012 11:43
Last Modified: 30 Nov 2012 17:11
URI: http://srodev.sussex.ac.uk/id/eprint/38248
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