Working paper

Sharing the Cost of Global Warming

Justin Leroux, and Étienne de Villemeur

Abstract

Due to meteorological factors, the distribution of the environmental damage due to climate change bears no relationship to that of global emissions. We argue in favor of offsetting this discrepancy, and propose a "global insurance scheme" to be fincanced according to countries responsibility for climate change. Because GHG decay very slowly, we argue that the actual burden of global warming should be shared on the basis of cumulated emissions, raher than sharing the expected costs of actual emissions as in a Pigovian taxation scheme. We characterize new versions of two well-known cost-sharing schemes by adapting the responsibility theory of Bossert and Fleurbaey (1996) to a context with externalities.

JEL codes

  • D62: Externalities
  • D63: Equity, Justice, Inequality, and Other Normative Criteria and Measurement
  • Q54: Climate • Natural Disasters • Global Warming

Replaced by

Reference

Justin Leroux, and Étienne de Villemeur, Sharing the Cost of Global Warming, TSE Working Paper, n. 10-186, July 2010.

See also

Published in

TSE Working Paper, n. 10-186, July 2010