Minimizing Negative Externalities while Going Green

26 Pages Posted: 5 Jun 2023

See all articles by Charu Agarwal

Charu Agarwal

University of Illinois - Urbana Champaign

Date Written: June 2, 2023

Abstract

The objective examination of environmentally sustainable projects based on publicly available information raise concerns on their sustainability claims. Most of the projects are the recipients of generous public funds and are found to impose unrecorded externalities on communities that subsidize their development and operations. The welfare destructive effect creates a perpetual dead weight loss in the system with the rights of the fraction of the population to safe environment permanently compromised. I propose a simple incentive based subsidy and carbon offset program to circumvent some of the losses.

Keywords: Subsidy, Climate Change, Carbon Credit, Solar Energy, Wind Energy, Biomass, Sustainability

JEL Classification: D8, Q5

Suggested Citation

Agarwal, Charu, Minimizing Negative Externalities while Going Green (June 2, 2023). Available at SSRN: https://ssrn.com/abstract=4466644 or http://dx.doi.org/10.2139/ssrn.4466644

Charu Agarwal (Contact Author)

University of Illinois - Urbana Champaign ( email )

339 Wohlers Hall
1206 South Sixth Street
Champaign, IL 61820
United States

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