Climate Campaigns, Cap and Trade, and Carbon Leakage: Why Trying to Reduce Your Carbon Footprint Can Harm the Climate

A-Tier
Journal: Journal of the Association of Environmental and Resource Economists
Year: 2015
Volume: 2
Issue: 3
Pages: 469 - 495

Score contribution per author:

4.022 = (α=2.01 / 1 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

Governments and environmental NGOs campaign for carbon footprint reductions by households. Many of the behavioral changes recommended reduce demand for goods produced by sectors covered by cap-and-trade schemes. With a binding cap, greenhouse gas emissions from those sectors do not change. I show that climate campaigns create leakage effects if coverage of cap-and-trade schemes is incomplete. Campaigns that shift demand away from sectors subject to a cap increase aggregate emissions, as do campaigns to reduce carbon footprints generally if the capped sectors are emission intensive. However, campaigns targeting sectors not covered by a cap-and-trade scheme or propagating retiring of emission allowances reduce emissions.

Technical Details

RePEc Handle
repec:ucp:jaerec:doi:10.1086/682572
Journal Field
Environment
Author Count
1
Added to Database
2026-01-28