This paper provides a numerical illustration of how an international carbon treaty might work. The simulations in this paper using 2004 data on carbon emissions and per capita GDP from 178 countries suggest that high-income countries might be much better off collectively compensating low-income...

Using a macro-econometric model we provide a quantitative estimate of the cash transfer or tax cut that would achieve recovery from a severe recession when the central bank is unable to achieve full recovery because of the zero bound. We introduce an automatic transfer and simulate its...