Jump to ContentJump to Main Navigation
Climate Policy and Nonrenewable ResourcesThe Green Paradox and Beyond$
Users without a subscription are not able to see the full content.

Karen Pittel, Frederick van der Ploeg, and Cees Withagen

Print publication date: 2014

Print ISBN-13: 9780262027885

Published to MIT Press Scholarship Online: January 2015

DOI: 10.7551/mitpress/9780262027885.001.0001

Show Summary Details
Page of

PRINTED FROM MIT PRESS SCHOLARSHIP ONLINE (www.mitpress.universitypressscholarship.com). (c) Copyright The MIT Press, 2022. All Rights Reserved. An individual user may print out a PDF of a single chapter of a monograph in MITSO for personal use.date: 22 May 2022

Going Full Circle: Demandside Constraints to the Green Paradox

Going Full Circle: Demandside Constraints to the Green Paradox

(p.225) 10 Going Full Circle: Demandside Constraints to the Green Paradox
Climate Policy and Nonrenewable Resources

Corrado Di Maria

Ian Lange

Edwin van der Werf

The MIT Press

This chapter deals with the effects of announcements of green policies that are delayed later on. Firstly, it shows that announcing a unit tax to start at some point in future that grows at the interest rate increases cumulative extraction until any given point in time compared to a zero tax policy. Secondly, an unexpected delay of the introduction of this tax at the originally announced starting date is discussed. While the Green Paradox literature usually states that lowering taxes implies less cumulative emissions, this is not true for postponing their introduction. Reoptimizing resource owners facing a period with unexpectedly low taxes speed up extraction during this period and correspondingly reduce their extraction later on. Consequently, cumulative extraction is higher at any given point in time. Moreover, cumulative extraction under the announcement-cum-delay policy is also higher than if the ultimately realized policy is announced already at the outset.

Keywords:   Green Paradox, tax announcement, tax delay, green policy, resource owner, extraction

MIT Press Scholarship Online requires a subscription or purchase to access the full text of books within the service. Public users can however freely search the site and view the abstracts and keywords for each book and chapter.

Please, subscribe or login to access full text content.

If you think you should have access to this title, please contact your librarian.

To troubleshoot, please check our FAQs, and if you can't find the answer there, please contact us.