@article{4a96c9f1e9a543f2b917bae6917a1268,
title = "Optimal Climate Policy and the Future of World Economic Development",
abstract = "How much should the present generations sacrifice to reduce emissions today, in order to reduce the future harms of climate change? Within climate economics, debate on this question has been focused on so-called {"}ethical parameters{"} of social time preference and inequality aversion. We show that optimal climate policy similarly importantly depends on the future of the developing world. In particular, although global poverty is falling and the economic lives of the poor are improving worldwide, leading models of climate economics may be too optimistic about two central predictions: future population growth in poor countries, and future convergence in total factor productivity (TFP). We report results of small modifications to a standard model: under plausible scenarios for high future population growth (especially in sub-Saharan Africa) and for low future TFP convergence, we find that optimal near-term carbon taxes could be substantially larger.",
keywords = "carbon tax, climate change, climate policy, population growth, total factor productivity",
author = "Mark Budolfson and Francis Dennig and Marc Fleurbaey and Noah Scovronick and Asher Siebert and Dean Spears and Fabian Wagner",
note = "Funding Information: Dean Spears (corresponding author) is an Assistant Professor in the Economics Department of the University of Texas at Austin and a visiting economist at the Indian Statistical Institute in Delhi; his email address is dean@riceinstitute.org. Mark Budolfson is an Assistant Professor in the Philosophy Department at the University of Vermont; his email address is Mark.Budolfson@uvm.edu. Francis Dennig is an Assistant Professor at Yale-NUS College in Singapore; his email address is fdennig@yale-nus.edu.sg. Marc Fleurbaey is Robert E. Kuenne Professor in the Woodrow Wilson School and the Center for Human Values at the University of Princeton; his email address is mfleurba@princeton.edu. Noah Scovronick is a Postdoctoral Research Associate in the Woodrow Wilson School of Public and International Affairs at Princeton University; his email address is Noah.Scovronick@princeton.edu. Asher Siebert is a postdoctoral research scientist at the International Research Institute for Climate and Society at Columbia University; his email is asiebert@iri.columbia.edu. Fabian Wagner is a Senior Research Scholar at the International Institute for Applied Systems Analysis in Laxenburg, Austria; his email address is fabian@iiasa.ac.at. We appreciate comments from participants at NEUDC, the Eastern Economic Association, the Population Association of America annual meeting, and Princeton University. Errors are our own. This paper received no specific funding. The research of Dean Spears was supported by grant P2CHD042849, Population Research Center, awarded to the Population Research Center at the University of Texas at Austin by the Eunice Kennedy Shriver National Institute of Child Health and Human Development. The content is solely the responsibility of the authors and does not necessarily represent the official views of the National Institutes of Health. Supplementary online appendixes for this article can be found at The World Bank Economic Review website. Publisher Copyright: {\textcopyright} 2018 The Author. Published by Oxford University Press on behalf of the International Bank for Reconstruction and Development / THE WORLD BANK.",
year = "2019",
month = feb,
day = "1",
doi = "10.1093/wber/lhx016",
language = "English (US)",
volume = "33",
pages = "21--40",
journal = "World Bank Economic Review",
issn = "0258-6770",
publisher = "Oxford University Press",
number = "1",
}