Working Paper
Unintended Detrimental Effects of Environmental Policy: The Green Paradox and Beyond
Edwin van der Werf, Corrado Di Maria
CESifo, Munich, 2011
CESifo Working Paper No. 3466
CESifo, Munich, 2011
CESifo Working Paper No. 3466
Well-intended policies aimed at reducing greenhouse gas emissions may have unintended undesirable consequences. Recently, a large literature has emerged showing under what conditions this so-called ‘Green Paradox’ may occur. We review this literature and identify the key mechanisms behind these paradoxical policy outcomes and highlight avenues for future research.
CESifo Category
Energy and Climate Economics
Resources and Environment
Energy and Climate Economics
Resources and Environment
Keywords: climate policy, green paradox, non-renewable resources, scarcity, carbon tax, announcement effects, implementation lag, carbon leakage, backstop technology
JEL Classification: F180, Q310, Q410, Q420, Q540, Q580