Smart Cap

• 成果类型: Article
• 署名作者: Karp, Larry; Traeger, Christian
• 署名单位: University of California System; University of California Berkeley; University of Oslo; Leibniz Association; Ifo Institut
• 刊物名称: JOURNAL OF THE EUROPEAN ECONOMIC ASSOCIATION
• ISSN/ISSBN: 1542-4766
• DOI: 10.1093/jeea/jvae030
• 发表日期: 2025
• 页码: 554-593
• 关键词: imperfect information; stock externalities; intensity targets; permit markets; emissions; prices; uncertainty; quantities; policies; DESIGN

摘要

Policymakers'imperfect knowledge about firms' abatement costs leads to inefficient regulation, reducing the welfare gains from carbon markets around the world. We introduce a smart cap and trade system that eliminates these costs. This cap responds endogenously to technology or macroeconomic shocks, relying on the market price of certificates to aggregate information. It allows policy makers to modify existing institutions to achieve more efficient emissions reductions. The paper also shows that the slow diffusion of technology innovations typically makes the optimal carbon price a much steeper function of emissions than suggested by the Social Cost of Carbon.