Supply side climate policy and the green paradox

Supply side climate policy and the green paradox / Michael Hoel. University of Oslo. Department of Economics, 14/01/2013, 27 p. (Memo 03/2013-v1)

Abstract (© Michael Hoel) :

The focus of the green paradox literature has been either on demand-side climate policies or on effects of technological changes. The present paper addresses the question of whether there also might be some kind of green paradox related to supply-side policies, i.e. policies that permanently remove some of the carbon resources. The conclusion is that there will no green paradox if supply-side climate policies are aimed at high-cost carbon reserves. If instead low-cost reserves are removed, the possibility that both early and total emissions increase cannot be ruled out. Hence, “wrong” supply-side climate policies may give a supply-side green paradox.

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