The Optimal Timing of Greenhouse Gas Emission Abatement, Individual Rationality and Intergenerational Equity

Fondazione Eni Enrico Mattei Working Paper No. 3.98

21 Pages Posted: 10 Sep 1998

See all articles by Richard S. J. Tol

Richard S. J. Tol

VU University Amsterdam - Institute for Environmental Studies (IVM); Carnegie Mellon University - Center for Integrated Study of the Human Dimensions of Global Change; University of Hamburg - Centre for Marine and Climate Research (ZMK); Princeton University

Date Written: January 1998

Abstract

This paper explores the relationship between rationality and equity in an intergenerational context of greenhouse gas emission reduction. It is shown that the least-cost trajectory to a constraint on cumulative emissions implies an upward-sloping emission reduction effort, whether technological development is exogenous or endogenous (either investments in research, development and demonstration or learning-by-doing). The least-cost trajectory, however, also implies in most cases that generations in the further future face higher relative costs than do generations in the nearer future. Cost-effectiveness thus may well violate intergenerational equity and rationality of future decision makers. More equitable solutions would lead to a relative shift of abatement effort to the near future, although emission reduction would still be increasing over time. In all cases, technological development in the earlier decades is very important.

JEL Classification: Q25, Q40

Suggested Citation

Tol, Richard S. J., The Optimal Timing of Greenhouse Gas Emission Abatement, Individual Rationality and Intergenerational Equity (January 1998). Fondazione Eni Enrico Mattei Working Paper No. 3.98, Available at SSRN: https://ssrn.com/abstract=123768 or http://dx.doi.org/10.2139/ssrn.123768

Richard S. J. Tol (Contact Author)

VU University Amsterdam - Institute for Environmental Studies (IVM) ( email )

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Carnegie Mellon University - Center for Integrated Study of the Human Dimensions of Global Change

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University of Hamburg - Centre for Marine and Climate Research (ZMK)

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Germany

Princeton University ( email )

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