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search.filters.applied.f.access: openAccess × Author: Kornek, Ulrike ×

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    When redistribution makes personalized pricing of externalities useless
    (Oxford : Wiley-Blackwell, 2021) Fleurbaey, Marc; Kornek, Ulrike
    We consider a standard optimal taxation framework in which consumers' preferences are separable in consumption and labor and identical over consumption, but are affected by consumption externalities. For every nonlinear, income-dependent pricing of goods there is a linear pricing scheme, combined with an adjusted income tax schedule, that leaves all consumers equally well-off and weakly increases the government's budget. The result depends on whether a linear pricing scheme exists that keeps the aggregate amount of consumption at its initial level observed under nonlinear pricing. We provide sufficient conditions for the assumption to hold. If adjusting the income tax rate is not available, personalized prices for an externality can enhance social welfare if they are redistributive, that is, favor consumers with a larger marginal social value of income.
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    The social cost of carbon and inequality: When local redistribution shapes global carbon prices
    (Amsterdam [u.a.] : Elsevier, 2021) Kornek, Ulrike; Klenert, David; Edenhofer, Ottmar; Fleurbaey, Marc
    The social cost of carbon is a central metric for optimal carbon prices. Previous literature shows that inequality significantly influences the social cost of carbon, but mostly omits heterogeneity below the national level. We present an optimal taxation model of the social cost of carbon that accounts for inequality between and within countries. We find that climate and distributional policy can generally not be separated. If only one country does not compensate low-income households for disproportionate damages, the social cost of carbon tends to increase globally. Optimal carbon prices remain roughly unchanged if national redistribution leaves inequality between households unaffected by climate change and if the utility of households is approximately logarithmic in consumption.
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    What is important for achieving 2 °C? UNFCCC and IPCC expert perceptions on obstacles and response options for climate change mitigation
    (Bristol : IOP Publ., 2020) Kornek, Ulrike; Flachsland, Christian; Kardish, Chris; Levi, Sebastian; Edenhofer, Ottmar
    Global mitigation efforts remain insufficient to limit the global temperature increase to well below 2 °C. While a growing academic literature analyzes this problem, perceptions of which obstacles inhibit goal attainment and which responses might be most effective seem to differ widely. This makes prioritization and agreement on the way forward difficult. To inform prioritization in global climate policy and research agendas, we present quantitative data on how 917 experts from the IPCC and the UNFCCC perceive the importance of different obstacles and response options for achieving 2 °C. On average, respondents consider opposition from special interest groups the most important obstacle and technological R&D the most important response. Our survey also finds that the majority of experts perceives a wide range of issues as important, supporting an agenda that is inclusive in terms of coverage. Average importance ratings differ between experts from the Global North and South, suggesting that balanced representation in global fora and regionally differentiated agendas are important. In particular, opposition from special interest groups is a top priority among experts from North America, Europe and Oceania. Investigating the drivers of individual importance ratings, we find little difference between experts from the IPCC and the UNFCCC, while expert's perceptions correlate with their academic training and their national scientific, regulatory, and financial contexts.
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    The strategic dimension of financing global public goods
    (Amsterdam : Elsevier, 2020) Kornek, Ulrike; Edenhofer, Ottmar
    One challenge in addressing transboundary problems such as climate change is the incentive to free-ride. Transfers from multilateral compensation funds are often used to counteract such incentives, albeit with varying success. We examine how such funds can change the incentive to free-ride in a global public-goods game. In our game, self-interested countries choose their own preferred course, deciding their voluntary public good provision, whether to join a fund that offers compensation for providing the public good and the volume of compensatory payments. We show that (i) total public-good provision is higher when those contributing are given more compensation; and (ii) non-participation in the fund can be punished if the remaining members decrease their public-good provision sufficiently. We then examine three specific fund designs. In the first, the compensation paid to each country is equal to the percentage of above-average total costs for public-goods provision. This design is best able to deter free-riding and can establish the social optimum as the equilibrium. In the second, the compensation paid to each country is a function of the marginal cost of their public-good provision. Here there are significant incentives to free-ride. In the third case, the monetary resources provided by the fund are fixed, a design frequently encountered in international funds. This design is the one least able to deter free-riding. © 2020 The Author(s)