@article{AmbergausdemMooreBekketal.2022,
  author    = {Amberg, Maximilian and aus dem Moore, Nils and Bekk, Anke and Bergmann, Tobias and Edenhofer, Ottmar and Flachsland, Christian and George, Jan and Haywood, Luke and Heinemann, Maik and Held, Anne and Kalkuhl, Matthias and Kellner, Maximilian and Koch, Nicolas and Luderer, Gunnar and Meyer, Henrika and Nikodinoska, Dragana and Pahle, Michael and Roolfs, Christina and Schill, Wolf-Peter},
  title     = {Reformoptionen f{\"u}r ein nachhaltiges Steuer- und Abgabensystem},
  series = {Perspektiven der Wirtschaftspolitik},
  volume    = {23},
  journal   = {Perspektiven der Wirtschaftspolitik},
  number    = {3},
  publisher = {De Gruyter},
  address   = {Berlin},
  issn      = {1465-6493},
  doi       = {10.1515/pwp-2021-0051},
  pages     = {165 -- 199},
  year      = {2022},
  abstract  = {Steuern und Abgaben auf Produkte oder Verbrauch mit gesellschaftlichen Folgekosten (externe Kosten) - sogenannte Pigou- oder Lenkungssteuern - sind ein gesellschaftliches „Win-Win-Instrument". Sie verbessern die Wohlfahrt und sch{\"u}tzen gleichzeitig die Umwelt und das Klima. Dies wird erreicht, indem umweltsch{\"a}digende Aktivit{\"a}ten einen Preis bekommen, der m{\"o}glichst exakt der H{\"o}he des Schadens entspricht. Eine konsequente Bepreisung der externen Kosten nach diesem Prinzip k{\"o}nnte in Deutschland erhebliche zus{\"a}tzliche Einnahmen erbringen: Basierend auf bisherigen Studien zu externen Kosten w{\"a}ren zus{\"a}tzliche Einnahmen in der Gr{\"o}ßenordnung von 348 bis 564 Milliarden Euro pro Jahr (44 bis 71 Prozent der gesamten Steuereinnahmen) m{\"o}glich. Die Autoren warnen allerdings, dass die Bezifferung der externen Kosten mit erheblichen Unsicherheiten verbunden ist. Damit Lenkungssteuern und -abgaben ihre positiven Lenkungs- und Wohlstandseffekte voll entfalten k{\"o}nnen, seien zudem institutionelle Reformen notwendig.},
  language  = {de}
}
@article{KalkuhlEdenhofer2016,
  author    = {Kalkuhl, Matthias and Edenhofer, Ottmar},
  title     = {Ramsey meets Th{\"u}nen},
  series = {International tax and public finance},
  volume    = {24},
  journal   = {International tax and public finance},
  publisher = {Springer},
  address   = {Dordrecht},
  issn      = {0927-5940},
  doi       = {10.1007/s10797-016-9403-6},
  pages     = {350 -- 380},
  year      = {2016},
  abstract  = {Land taxes can increase production in the manufacturing sector and enhance land conservation at the same time, which can lead to overall macroeconomic growth. Existing research emphasizes the non-distorting properties of land taxes (when fixed factors are taxed) as well as growth-enhancing impacts (when asset portfolios are shifted to reproducible capital). This paper furthers the neoclassical perspective on land taxes by endogenizing land allocation decisions in a multi-sector growth model. Based on von Th{\"u}nen's observation, agricultural land is created from wilderness through conversion and cultivation, both of which are associated with costs. In the steady state of our general equilibrium model, land taxes not only may reduce land consumption (associated with environmental benefits) but may also affect overall economic output, while leaving wages and interest rates unaffected. When labor productivity is higher in the manufacturing than in the agricultural sector and agricultural and manufactured goods are substitutes (or the economy is open to world trade), land taxes increase aggregate economic output. There is a complex interplay of conservation policy, technological change and land taxes, depending on consumer preferences, sectoral labor productivities and openness-to-trade. Our model introduces a new perspective on land taxes in current policy debates on development, tax reforms as well as forest conservation.},
  language  = {en}
}
@article{EdenhoferFranksKalkuhl2021,
  author    = {Edenhofer, Ottmar and Franks, Max and Kalkuhl, Matthias},
  title     = {Pigou in the 21st century},
  series = {International tax and public finance},
  volume    = {28},
  journal   = {International tax and public finance},
  number    = {5},
  publisher = {Springer},
  address   = {Dordrecht},
  issn      = {0927-5940},
  doi       = {10.1007/s10797-020-09653-y},
  pages     = {1090 -- 1121},
  year      = {2021},
  abstract  = {The year 2020 marks the centennial of the publication of Arthur Cecil Pigou's magnum opus The Economics of Welfare. Pigou's pricing principles have had an enduring influence on the academic debate, with a widespread consensus having emerged among economists that Pigouvian taxes or subsidies are theoretically desirable, but politically infeasible. In this article, we revisit Pigou's contribution and argue that this consensus is somewhat spurious, particularly in two ways: (1) Economists are too quick to ignore the theoretical problems and subtleties that Pigouvian pricing still faces; (2) The wholesale skepticism concerning the political viability of Pigouvian pricing is at odds with its recent practical achievements. These two points are made by, first, outlining the theoretical and political challenges that include uncertainty about the social cost of carbon, the unclear relationship between the cost-benefit and cost-effectiveness approaches, distributional concerns, fragmented ministerial responsibilities, an unstable tax base, commitment problems, lack of acceptance and trust between government and citizens as well as incomplete international cooperation. Secondly, we discuss the recent political success of Pigouvian pricing, as evidenced by the German government's 2019 climate policy reform and the EU's Green Deal. We conclude by presenting a research agenda for addressing the remaining barriers that need to be overcome to make Pigouvian pricing a common political practice.},
  language  = {en}
}
@article{HaenselFranksKalkuhletal.2022,
  author    = {H{\"a}nsel, Martin C. and Franks, Max and Kalkuhl, Matthias and Edenhofer, Ottmar},
  title     = {Optimal carbon taxation and horizontal equity},
  series = {Journal of environmental economics and management},
  volume    = {116},
  journal   = {Journal of environmental economics and management},
  publisher = {Elsevier},
  address   = {Amsterdam},
  issn      = {0095-0696},
  doi       = {10.1016/j.jeem.2022.102730},
  year      = {2022},
  abstract  = {We develop a model of optimal taxation and redistribution under an ambitious climate target. We take into account vertical income differences, but also explicitly capture horizontal equity concerns by considering heterogeneous energy efficiencies. By deriving first- and second-best rules for policy instruments including carbon and labor taxes, transfers and energy subsidies, we investigate analytically how vertical and horizontal inequality is considered in the welfare maximizing tax structure. We calibrate the model to German household data and a 30 percent emission reduction goal and show that redistribution of carbon tax revenues via household-specific transfers is the first-best policy. Under plausible assumptions on inequality aversion, transfers to energy-intensive households should be about five times higher than transfers to energy-efficient households. Equal per-capita transfers do not require to observe households' efficiency type, but increase equity-weighted mitigation costs by around 5 percent compared to the first-best. Mitigation costs increase by less, if the government can implement a uniform clean energy subsidy or household-specific tax-subsidy schemes on energy consumption and labor income that target heterogeneous energy efficiencies. Horizontal equity concerns may therefore constitute a new second-best rationale for clean energy policies or differentiated energy taxes.},
  language  = {en}
}
@article{EdenhoferKalkuhlRequateetal.2020,
  author    = {Edenhofer, Ottmar and Kalkuhl, Matthias and Requate, Tilman and Steckel, Jan Christoph},
  title     = {How assets get stranded},
  series = {Journal of environmental economics and management},
  volume    = {100},
  journal   = {Journal of environmental economics and management},
  publisher = {Elsevier},
  address   = {Amsterdam},
  issn      = {0095-0696},
  doi       = {10.1016/j.jeem.2020.102300},
  pages     = {4},
  year      = {2020},
  abstract  = {Internalizing external costs of carbon is a fundamental goal of climate policy. Since the seminal work of Arthur Pigou in 1920, economic theory has analyzed the efficiency gains arising from various instruments that internalize externalities and lead to Pareto-improvements. It is widely recognized in environmental economics that a carbon price would effectively reflect the scarcity of the atmospheric disposal space for carbon depending on the temperature target that is to be achieved. The question of how to organize the transition process, i.e. moving from inefficient to efficient allocations, and implementing the necessary policies, has gained increasing attention in recent years. Arguably, the transition process is tightly interwoven with political processes that include complex interactions between societal stakeholders, such as households and firms, on the one hand, and political decision makers, on the other. Accordingly, understanding political-economy aspects of the transition process, including distributional outcomes, is becoming increasingly relevant. While a growing literature discusses the distributional implications of climate policy on households, it is less well understood how asset owners might be affected by climate policy and how these potential impacts would interact with the transition process. This Special Section focuses on public policy challenges related to this transition problem, with special emphasis on asset owners. A core theme is the special role of stranded assets, i.e. a devaluation of capital stocks or financial assets either by introducing a stringent carbon price or by omitting a pre-announced policy of this kind.},
  language  = {en}
}
@article{PiontekKalkuhlKriegleretal.2019,
  author    = {Piontek, Franziska and Kalkuhl, Matthias and Kriegler, Elmar and Schultes, Anselm and Leimbach, Marian and Edenhofer, Ottmar and Bauer, Nico},
  title     = {Economic Growth Effects of Alternative Climate Change Impact Channels in Economic Modeling},
  series = {Environmental \& resource economics : the official journal of the European Association of Environmental and Resource Economists},
  volume    = {73},
  journal   = {Environmental \& resource economics : the official journal of the European Association of Environmental and Resource Economists},
  number    = {4},
  publisher = {Springer},
  address   = {Dordrecht},
  issn      = {0924-6460},
  doi       = {10.1007/s10640-018-00306-7},
  pages     = {1357 -- 1385},
  year      = {2019},
  abstract  = {Despite increasing empirical evidence of strong links between climate and economic growth, there is no established model to describe the dynamics of how different types of climate shocks affect growth patterns. Here we present the first comprehensive, comparative analysis of the long-term dynamics of one-time, temporary climate shocks on production factors, and factor productivity, respectively, in a Ramsey-type growth model. Damages acting directly on production factors allow us to study dynamic effects on factor allocation, savings and economic growth. We find that the persistence of impacts on economic activity is smallest for climate shocks directly impacting output, and successively increases for direct damages on capital, loss of labor and productivity shocks, related to different responses in savings rates and factor-specific growth. Recurring shocks lead to large welfare effects and long-term growth effects, directly linked to the persistence of individual shocks. Endogenous savings and shock anticipation both have adaptive effects but do not eliminate differences between impact channels or significantly lower the dissipation time. Accounting for endogenous growth mechanisms increases the effects. We also find strong effects on income shares, important for distributional implications. This work fosters conceptual understanding of impact dynamics in growth models, opening options for links to empirics.},
  language  = {en}
}
@article{SchultesPiontekSoergeletal.2021,
  author    = {Schultes, Anselm and Piontek, Franziska and Soergel, Bjoern and Rogelj, Joeri and Baumstark, Lavinia and Kriegler, Elmar and Edenhofer, Ottmar and Luderer, Gunnar},
  title     = {Economic damages from on-going climate change imply deeper near-term emission cuts},
  series = {Environmental research letters},
  volume    = {16},
  journal   = {Environmental research letters},
  number    = {10},
  publisher = {IOP Publishing},
  address   = {Bristol},
  issn      = {1748-9326},
  doi       = {10.1088/1748-9326/ac27ce},
  pages     = {11},
  year      = {2021},
  abstract  = {Pathways toward limiting global warming to well below 2 ∘C, as used by the IPCC in the Fifth Assessment Report, do not consider the climate impacts already occurring below 2 ∘C. Here we show that accounting for such damages significantly increases the near-term ambition of transformation pathways. We use econometric estimates of climate damages on GDP growth and explicitly model the uncertainty in the persistence time of damages. The Integrated Assessment Model we use includes the climate system and mitigation technology detail required to derive near-term policies. We find an optimal carbon price of \$115 per tonne of CO2 in 2030. The long-term persistence of damages, while highly uncertain, is a main driver of the near-term carbon price. Accounting for damages on economic growth increases the gap between the currently pledged nationally determined contributions and the welfare-optimal 2030 emissions by two thirds, compared to pathways considering the 2 ∘C limit only.},
  language  = {en}
}
@article{EdenhoferKalkuhlOckenfels2020,
  author    = {Edenhofer, Ottmar and Kalkuhl, Matthias and Ockenfels, Axel},
  title     = {Das Klimaschutzprogramm der Bundesregierung},
  series = {Perspektiven der Wirtschaftspolitik},
  volume    = {21},
  journal   = {Perspektiven der Wirtschaftspolitik},
  number    = {1},
  publisher = {De Gruyter},
  address   = {Berlin},
  issn      = {1465-6493},
  doi       = {10.1515/pwp-2020-0001},
  pages     = {4 -- 18},
  year      = {2020},
  abstract  = {Das Klimaschutzgesetz hat einen Paradigmenwechsel eingeleitet: den Einstieg in eine CO2-Bepreisung als k{\"u}nftiges Leitinstrument der Klimapolitik. Auf den ersten Blick ist der CO2-Preis unter einer F{\"u}lle von F{\"o}rdermaßnahmen und ordnungsrechtlichen Regelungen versch{\"u}ttet, deren Wirksamkeit und Kosten h{\"o}chst unsicher sind. Der CO2-Preis ist aber so angelegt, dass er langfristig das dominante Instrument einer europ{\"a}isch harmonisierten Klimapolitik werden kann. Der angedeutete Paradigmenwechsel der deutschen Klimapolitik {\"o}ffnet damit die T{\"u}r, die europ{\"a}ische und internationale Kooperation zu st{\"a}rken. Dazu ist es aber notwendig, neben der europ{\"a}ischen auch die globale Klimapolitik neu auszurichten. Auch dort sollten sich die Verhandlungen statt auf nationale Mengenziele auf CO2-Preise konzentrieren. Die erforderliche Kooperation wird m{\"o}glich, wenn die Regierungen Transferzahlungen strategisch und reziprok nutzen. So k{\"o}nnte die Effektivit{\"a}t der Klimapolitik erh{\"o}ht werden und es ließen sich die entstehenden Verteilungskonflikte entsch{\"a}rfen.},
  language  = {de}
}
@article{EdenhoferKalkuhlRoolfs2021,
  author    = {Edenhofer, Ottmar and Kalkuhl, Matthias and Roolfs, Christina},
  title     = {Carbon pricing and revenue recycling},
  series = {CESifo forum},
  volume    = {22},
  journal   = {CESifo forum},
  number    = {5},
  publisher = {Ifo},
  address   = {Munich},
  issn      = {2190-717X},
  pages     = {10 -- 14},
  year      = {2021},
  language  = {en}
}
@article{StreflerKrieglerBaueretal.2021,
  author    = {Strefler, Jessica and Kriegler, Elmar and Bauer, Nico and Luderer, Gunnar and Pietzcker, Robert C. and Giannousakis, Anastasis and Edenhofer, Ottmar},
  title     = {Alternative carbon price trajectories can avoid excessive carbon removal},
  series = {Nature communications},
  volume    = {12},
  journal   = {Nature communications},
  number    = {1},
  publisher = {Nature Publishing Group},
  address   = {London},
  issn      = {2041-1723},
  doi       = {10.1038/s41467-021-22211-2},
  pages     = {8},
  year      = {2021},
  abstract  = {The large majority of climate change mitigation scenarios that hold warming below 2 °C show high deployment of carbon dioxide removal (CDR), resulting in a peak-and-decline behavior in global temperature. This is driven by the assumption of an exponentially increasing carbon price trajectory which is perceived to be economically optimal for meeting a carbon budget. However, this optimality relies on the assumption that a finite carbon budget associated with a temperature target is filled up steadily over time. The availability of net carbon removals invalidates this assumption and therefore a different carbon price trajectory should be chosen. We show how the optimal carbon price path for remaining well below 2 °C limits CDR demand and analyze requirements for constructing alternatives, which may be easier to implement in reality. We show that warming can be held at well below 2 °C at much lower long-term economic effort and lower CDR deployment and therefore lower risks if carbon prices are high enough in the beginning to ensure target compliance, but increase at a lower rate after carbon neutrality has been reached.},
  language  = {en}
}
@article{KalkuhlSteckelEdenhofer2020,
  author    = {Kalkuhl, Matthias and Steckel, Jan Christoph and Edenhofer, Ottmar},
  title     = {All or nothing},
  series = {Journal of environmental economics and management},
  volume    = {100},
  journal   = {Journal of environmental economics and management},
  publisher = {Elsevier},
  address   = {San Diego},
  issn      = {0095-0696},
  doi       = {10.1016/j.jeem.2019.01.012},
  pages     = {21},
  year      = {2020},
  abstract  = {This paper develops a new perspective on stranded assets in climate policy using a partial equilibrium model of the energy sector. Political-economy related aspects are considered in the government's objective function. Lobbying power of firms or fiscal considerations by the government lead to time inconsistency: The government will deviate from a previously announced carbon tax which creates stranded assets. Under rational expectations, we show that a time-consistent policy outcome exists with either a zero carbon tax or a prohibitive carbon tax that leads to zero fossil investments - an "all-or-nothing" policy. Although stranded assets are crucial to such a bipolar outcome, they disappear again under time-consistent policy. Which of the two outcomes (all or nothing) prevails depends on the lobbying power of owners of fixed factors (land and fossil resources) but not on fiscal revenue considerations or on the lobbying power of renewable or fossil energy firms.},
  language  = {en}
}
@article{SurethKalkuhlEdenhoferetal.2023,
  author    = {Sureth, Michael and Kalkuhl, Matthias and Edenhofer, Ottmar and Rockstr{\"o}m, Johan},
  title     = {A welfare economic approach to planetary boundaries},
  series = {Jahrb{\"u}cher f{\"u}r National{\"o}konomie und Statistik},
  volume    = {243},
  journal   = {Jahrb{\"u}cher f{\"u}r National{\"o}konomie und Statistik},
  number    = {5},
  publisher = {De Gruyter Oldenbourg},
  address   = {Berlin},
  issn      = {0021-4027},
  doi       = {10.1515/jbnst-2022-0022},
  pages     = {477 -- 542},
  year      = {2023},
  abstract  = {The crises of both the climate and the biosphere are manifestations of the imbalance between human extractive, and polluting activities and the Earth's regenerative capacity. Planetary boundaries define limits for biophysical systems and processes that regulate the stability and life support capacity of the Earth system, and thereby also define a safe operating space for humanity on Earth. Budgets associated to planetary boundaries can be understood as global commons: common pool resources that can be utilized within finite limits. Despite the analytical interpretation of planetary boundaries as global commons, the planetary boundaries framework is missing a thorough integration into economic theory. We aim to bridge the gap between welfare economic theory and planetary boundaries as derived in the natural sciences by presenting a unified theory of cost-benefit and cost-effectiveness analysis. Our pragmatic approach aims to overcome shortcomings of the practical applications of CEA and CBA to environmental problems of a planetary scale. To do so, we develop a model framework and explore decision paradigms that give guidance to setting limits on human activities. This conceptual framework is then applied to planetary boundaries. We conclude by using the realized insights to derive a research agenda that builds on the understanding of planetary boundaries as global commons.},
  language  = {en}
}