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Policies to Reduce CO2 Emissions: Fallacies and Evidence from the United States and California

Since the 1990s, advocates of policy to prevent catastrophic climate change have been divided over
the appropriate economic instruments to curb CO2 emissions-carbon taxes or schemes of emission
trading. Barack Obama claimed that policies implemented during his presidency set in motion
irreversible trends toward a clean-energy economy, with the years 2008-2015 given as evidence of
decoupling between CO2 emissions and economic growth. This is despite California being the only
state in the USA that has implemented a specific policy to curb emissions, a cap-and-trade scheme in
place since 2013. To assess Obama's claims and the effectiveness of policies to reduce CO2
emissions, we analyze national and state-level data from the USA over the period 1990-2015. We
find: (a) annual changes in emissions strongly correlated with the growth conditions of the economy;
(b) no evidence for decoupling; and (c) a trajectory of CO2 emissions in California which does not at
all support the claim that the cap-and-trade system implemented there has reduced CO2 emissions. / Series: SRE - Discussion Papers

Identiferoai:union.ndltd.org:VIENNA/oai:epub.wu-wien.ac.at:6961
Date January 2019
CreatorsGranados, José A. Tapia, Spash, Clive L.
PublisherWU Vienna University of Economics and Business
Source SetsWirtschaftsuniversität Wien
LanguageEnglish
Detected LanguageEnglish
TypePaper, NonPeerReviewed
Formatapplication/pdf
Relationhttp://www.wu.ac.at/mlgd, http://epub.wu.ac.at/6961/

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