In the absence of an international agreement on climate policy, unilateral carbon abatement creates two problems: It tends to have a detrimental effect on domestic competitiveness, and it leads to an increase in carbon emissions abroad (leakage). This paper analyses two policies that have...

In a model inspired by the EU Emissions Trading Scheme, non-cooperative countries allocate their emissions to internationally trading and non-trading sectors. Each country is better off with trading than without, and aggregate welfare is maximized with all sectors in the trading scheme. We...

With the Paris Agreement and most of its detailed rulebook now finalized, countries and subnational actors face the challenge of translating climate targets and strategies into action and determining how to finance these actions. Through the Pilot Auction Facility for Methane and Climate Change...

This paper is about the impact on (low-skilled) labour. We build a new economic geography model in which two types of labour (low and high-skilled) are distinguished and in which, due to wage rigidies, unemployment may arise. We also introduce two types of transportation costs (for goods and...