Question A:
The European Union goal of reaching net zero emissions of greenhouse gases by 2050 will be a major drag on economic growth.
Responses
Responses weighted by each expert's confidence
Question B:
Carbon taxes are a better way to implement climate policy than cap-and-trade.
Responses
Responses weighted by each expert's confidence
Question C:
A carbon border tax targeting imports from non-EU countries with less strict climate policies is likely to harm developing economies.
Responses
Responses weighted by each expert's confidence
Question A Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
|---|---|---|---|---|
 Franklin Allen |
Imperial College London | Bio/Vote History | ||
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There are a lot of opportunities building new businesses from the climate change initiative. The time horizon is long enough for it to be ok
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 Pol Antras |
Harvard | Bio/Vote History | ||
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It's certainly would be costly, but I don't know what is meant by "major drag on economic growth"
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 Olivier Blanchard |
Peterson Institute | Bio/Vote History | ||
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Carbon taxes or caps are likely to lead to stranded assets, but alsohigh investment in new technologies. May come with higher tfp as well.
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 Nicholas Bloom |
Stanford | Bio/Vote History | ||
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 Richard William Blundell |
University College London | Bio/Vote History | ||
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 Agnès Bénassy-Quéré |
Paris School of Economics | Bio/Vote History | ||
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Depends on how the policy is carried out. The overall drag on growth may be limited but large uncertainty. Counterfactual is also unclear.
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 Elena Carletti |
Bocconi | Bio/Vote History | ||
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 Jean-Pierre Danthine |
Paris School of Economics | Bio/Vote History | ||
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A well crafted and timed transition strategy will create significant economic opportunities.
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 Paul De Grauwe |
LSE | Bio/Vote History | ||
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Creative destruction is involved here. It is never a major drag on growth, but leads losers and winners
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 Jan Eeckhout |
UPF Barcelona | Bio/Vote History | ||
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 Ernst Fehr |
Universität Zurich | Bio/Vote History | ||
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 Xavier Freixas |
Barcelona GSE | Bio/Vote History | ||
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The need for new technologies may substitute for the direct cost. Still, it may be the case that other countries get the benefits
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 Nicola Fuchs-Schündeln |
Goethe-Universität Frankfurt | Bio/Vote History | ||
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 Jordi Galí |
Barcelona GSE | Bio/Vote History | ||
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 Francesco Giavazzi |
Bocconi | Bio/Vote History | ||
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 Rachel Griffith |
University of Manchester | Bio/Vote History | ||
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 Veronica Guerrieri |
Chicago Booth | Bio/Vote History | ||
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 Luigi Guiso |
Einaudi Institute for Economics and Finance | Bio/Vote History | ||
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 Patrick Honohan |
Trinity College Dublin | Bio/Vote History | ||
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Admittedly it could be if handled badly; among other things, depends heavily on rest of world’s policies.
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 Beata Javorcik |
University of Oxford | Bio/Vote History | ||
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 Jan Pieter Krahnen |
Goethe University Frankfurt | Bio/Vote History | ||
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The policy will require significant public and private investments, allowing for knock-on effects that are likely to spur growth.
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 Botond Kőszegi |
Central European University | Bio/Vote History | ||
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 Eliana La Ferrara |
Harvard Kennedy | Bio/Vote History | ||
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 Christian Leuz |
Chicago Booth | Bio/Vote History | ||
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Likely a drag but hard to know how large. Goals have consequences for competitiveness & require large investments.
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 Thierry Mayer |
Sciences-Po | Bio/Vote History | ||
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 Costas Meghir |
Yale | Bio/Vote History | ||
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Zero emissions can be achieved in many ways - innovation, change in structure of tax without increases, are neutral or enhance growth.
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 Peter Neary |
Oxford | Bio/Vote History | ||
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Growth may be lower; but could be lower still if environmental degradation proceeds unchecked. Markets undevalue environmental quality
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 Kevin O'Rourke |
Oxford | Bio/Vote History | ||
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 Marco Pagano |
Università di Napoli Federico II | Bio/Vote History | ||
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 Lubos Pastor |
Chicago Booth | Bio/Vote History | ||
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It will be a drag on brown growth but a boost for green growth.
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 Torsten Persson |
Stockholm University | Bio/Vote History | ||
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 Christopher Pissarides |
London School of Economics and Political Science | Bio/Vote History | ||
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Switching to lower or zero emissions will create jobs that will offset any negative effects on GDP
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 Richard Portes |
London Business School | Bio/Vote History | ||
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 Canice Prendergast |
Chicago Booth | Bio/Vote History | ||
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 Lucrezia Reichlin |
London Business School | Bio/Vote History | ||
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 Rafael Repullo |
CEMFI | Bio/Vote History | ||
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 Hélène Rey |
London Business School | Bio/Vote History | ||
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This all depends how we get there. If major EU coordinated investments, R&D and leadership role, costs will be mitigated
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 Antoinette Schoar |
MIT | Bio/Vote History | ||
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 Daniel Sturm |
London School of Economics | Bio/Vote History | ||
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 John Van Reenen |
LSE | Bio/Vote History | ||
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My 2016 JPE paper with Aghion et al showed how carbon taxes (and R&D policies) could direct technical change towards cleaner innovation
-see background information here |
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 John Vickers |
Oxford | Bio/Vote History | ||
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 Hans-Joachim Voth |
University of Zurich | Bio/Vote History | ||
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 Beatrice Weder di Mauro |
The Graduate Institute, Geneva | Bio/Vote History | ||
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All depends on how it is implemented. With a credible pathway it could boost public and private investment while reallocating capital.
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 Karl Whelan |
University College Dublin | Did Not Answer | Bio/Vote History | |
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 Charles Wyplosz |
The Graduate Institute Geneva | Bio/Vote History | ||
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It will a drag, but major? We don't yet know what policies will be chosen so we can't guess about their impact.
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 Fabrizio Zilibotti |
Yale University | Bio/Vote History | ||
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Question B Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
|---|---|---|---|---|
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Franklin Allen |
Imperial College London | Bio/Vote History | ||
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This is an interesting question. I do not know the research in this area well.
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Pol Antras |
Harvard | Bio/Vote History | ||
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The late Marty Weitzman taught us that the theoretical answer is ambiguous; but taxes are more transparent and less prone to rent-seeking
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Olivier Blanchard |
Peterson Institute | Bio/Vote History | ||
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Weitzman discussion of prices versus quantities. Cap and trade more manipulable, but achieving given quantity for sure may be needed.
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Nicholas Bloom |
Stanford | Bio/Vote History | ||
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Richard William Blundell |
University College London | Bio/Vote History | ||
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Agnès Bénassy-Quéré |
Paris School of Economics | Bio/Vote History | ||
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In theory cap-and-trade is attractive but in practice it fails to give a long-term perspective on carbon prices.
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Elena Carletti |
Bocconi | Bio/Vote History | ||
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Jean-Pierre Danthine |
Paris School of Economics | Bio/Vote History | ||
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I tend to agree but reaching the goal while taking political constraints into account requires being pragmatic
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Paul De Grauwe |
LSE | Bio/Vote History | ||
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In absence of uncertainty both are equivalent. Cap and trade creates too much cost uncertainty for the investors in new technologies
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Jan Eeckhout |
UPF Barcelona | Bio/Vote History | ||
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This about the uncertainty of the economic consequences. The carbon tax allows quantity to adjust, C&T lets price adjust. We don't know...
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Ernst Fehr |
Universität Zurich | Bio/Vote History | ||
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Xavier Freixas |
Barcelona GSE | Bio/Vote History | ||
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prices are better than caps at producing the right effects
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Nicola Fuchs-Schündeln |
Goethe-Universität Frankfurt | Bio/Vote History | ||
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Jordi Galí |
Barcelona GSE | Bio/Vote History | ||
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Francesco Giavazzi |
Bocconi | Bio/Vote History | ||
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Rachel Griffith |
University of Manchester | Bio/Vote History | ||
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Veronica Guerrieri |
Chicago Booth | Bio/Vote History | ||
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Luigi Guiso |
Einaudi Institute for Economics and Finance | Bio/Vote History | ||
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Patrick Honohan |
Trinity College Dublin | Bio/Vote History | ||
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On balance this seems a cleaner approach less likely to be hijacked by special interest lobbying.
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Beata Javorcik |
University of Oxford | Bio/Vote History | ||
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Jan Pieter Krahnen |
Goethe University Frankfurt | Bio/Vote History | ||
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The big difference is the "cap" - without it, taxes may distort investment and consumption, but will not necessarily reduce emissions.
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Botond Kőszegi |
Central European University | Bio/Vote History | ||
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Eliana La Ferrara |
Harvard Kennedy | Bio/Vote History | ||
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Cap-and-trade allows to better control total amount of emissions. Also, in Europe carbon taxes pose greater political economy problems
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Christian Leuz |
Chicago Booth | Bio/Vote History | ||
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Tax has some advantages (link), but no clear dominance. Cap&trade may be politically easier to implement. Either one better than status quo.
-see background information here |
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Thierry Mayer |
Sciences-Po | Bio/Vote History | ||
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Costas Meghir |
Yale | Bio/Vote History | ||
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Peter Neary |
Oxford | Bio/Vote History | ||
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Both are good alternatives to command-and-control, incentivizing concern for environmental quality. The choice between them is contingent
-see background information here |
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Kevin O'Rourke |
Oxford | Bio/Vote History | ||
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Marco Pagano |
Università di Napoli Federico II | Bio/Vote History | ||
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Lubos Pastor |
Chicago Booth | Bio/Vote History | ||
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Torsten Persson |
Stockholm University | Bio/Vote History | ||
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Christopher Pissarides |
London School of Economics and Political Science | Bio/Vote History | ||
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Both are needed. If I had to choose one only I would choose taxes
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Richard Portes |
London Business School | Bio/Vote History | ||
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Canice Prendergast |
Chicago Booth | Bio/Vote History | ||
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Lucrezia Reichlin |
London Business School | Bio/Vote History | ||
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Rafael Repullo |
CEMFI | Bio/Vote History | ||
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Hélène Rey |
London Business School | Bio/Vote History | ||
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Best way is predictably rising carbon price path with redistribution of carbon dividend and accompanying investments
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Antoinette Schoar |
MIT | Bio/Vote History | ||
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Either can be effective depending on the enforcement environment and industry structure within a country.
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Daniel Sturm |
London School of Economics | Bio/Vote History | ||
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John Van Reenen |
LSE | Bio/Vote History | ||
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John Vickers |
Oxford | Bio/Vote History | ||
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Hans-Joachim Voth |
University of Zurich | Bio/Vote History | ||
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Beatrice Weder di Mauro |
The Graduate Institute, Geneva | Bio/Vote History | ||
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Karl Whelan |
University College Dublin | Did Not Answer | Bio/Vote History | |
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Charles Wyplosz |
The Graduate Institute Geneva | Bio/Vote History | ||
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Carbon tax does the right thing (if set on a correct rising schedule) and brings money. Cap and trade can be manipulated.
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Fabrizio Zilibotti |
Yale University | Bio/Vote History | ||
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Question C Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
|---|---|---|---|---|
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Franklin Allen |
Imperial College London | Bio/Vote History | ||
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In the short run there may be negative effects unless there is a long lead in time. In the long run it will help climate change.
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Pol Antras |
Harvard | Bio/Vote History | ||
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It is hard to imagine that the incidence of the border tax would be such that only importing countries bear the cost
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Olivier Blanchard |
Peterson Institute | Bio/Vote History | ||
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Afraid that this may be right. May justify helping them through other channels.
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Nicholas Bloom |
Stanford | Bio/Vote History | ||
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Richard William Blundell |
University College London | Bio/Vote History | ||
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Agnès Bénassy-Quéré |
Paris School of Economics | Bio/Vote History | ||
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Developing countries will be major losers of climate change. They may in fact negotiate lump-sum transfers.
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Elena Carletti |
Bocconi | Bio/Vote History | ||
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Jean-Pierre Danthine |
Paris School of Economics | Bio/Vote History | ||
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Yes in the absence of compensating financial mechanisms that should be put in place to avoid that outcome.
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Paul De Grauwe |
LSE | Bio/Vote History | ||
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Jan Eeckhout |
UPF Barcelona | Bio/Vote History | ||
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Ernst Fehr |
Universität Zurich | Bio/Vote History | ||
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Xavier Freixas |
Barcelona GSE | Bio/Vote History | ||
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Nicola Fuchs-Schündeln |
Goethe-Universität Frankfurt | Bio/Vote History | ||
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Jordi Galí |
Barcelona GSE | Bio/Vote History | ||
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Francesco Giavazzi |
Bocconi | Bio/Vote History | ||
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Rachel Griffith |
University of Manchester | Bio/Vote History | ||
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Veronica Guerrieri |
Chicago Booth | Bio/Vote History | ||
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Luigi Guiso |
Einaudi Institute for Economics and Finance | Bio/Vote History | ||
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Patrick Honohan |
Trinity College Dublin | Bio/Vote History | ||
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Time horizon? Potential for this type of policy being used as a smokescreen for protectionist goals?
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Beata Javorcik |
University of Oxford | Bio/Vote History | ||
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Jan Pieter Krahnen |
Goethe University Frankfurt | Bio/Vote History | ||
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The question leaves open whether or not the border tax is accompanied by higher levies for CO2 production within borders.
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Botond Kőszegi |
Central European University | Bio/Vote History | ||
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Eliana La Ferrara |
Harvard Kennedy | Bio/Vote History | ||
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Might harm their exports in short run, but lead to welfare gains in long run due to incentives to adopt cleaner technology
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Christian Leuz |
Chicago Booth | Bio/Vote History | ||
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It hurts exports of some countries with high carbon use in production but could complement policies in EU if we lack global solution.
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Thierry Mayer |
Sciences-Po | Bio/Vote History | ||
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Costas Meghir |
Yale | Bio/Vote History | ||
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Peter Neary |
Oxford | Bio/Vote History | ||
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Provided border taxes are not merely protectionist, they are likely to encourage better environmental policies in developing countries
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Kevin O'Rourke |
Oxford | Bio/Vote History | ||
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Marco Pagano |
Università di Napoli Federico II | Bio/Vote History | ||
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Lubos Pastor |
Chicago Booth | Bio/Vote History | ||
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Torsten Persson |
Stockholm University | Bio/Vote History | ||
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I am assuming that there is no other form of compensation to low-income countries.
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Christopher Pissarides |
London School of Economics and Political Science | Bio/Vote History | ||
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Yes, but it will save the planet, so it is necessary. Eventually they will switch production techniques anyway
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Richard Portes |
London Business School | Bio/Vote History | ||
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Canice Prendergast |
Chicago Booth | Bio/Vote History | ||
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Lucrezia Reichlin |
London Business School | Bio/Vote History | ||
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Rafael Repullo |
CEMFI | Bio/Vote History | ||
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Hélène Rey |
London Business School | Bio/Vote History | ||
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Depends on accompanying policies: technological transfers and aid to mitigate costs could help a lot.
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Antoinette Schoar |
MIT | Bio/Vote History | ||
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Short term: Increases costs and investments in less polluting technologies. Longer term: These countries are at risk from climate change
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Daniel Sturm |
London School of Economics | Bio/Vote History | ||
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John Van Reenen |
LSE | Bio/Vote History | ||
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John Vickers |
Oxford | Bio/Vote History | ||
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Hans-Joachim Voth |
University of Zurich | Bio/Vote History | ||
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Beatrice Weder di Mauro |
The Graduate Institute, Geneva | Bio/Vote History | ||
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Karl Whelan |
University College Dublin | Did Not Answer | Bio/Vote History | |
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Charles Wyplosz |
The Graduate Institute Geneva | Bio/Vote History | ||
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It will hurt countries that do not adopt climate change policies, whether rich or poor. It has good incentives property.
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Fabrizio Zilibotti |
Yale University | Bio/Vote History | ||
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