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American Economic Review Vol. 101 No. 3 2011

Challenges from State-Federal Interactions in US Climate Change Policy

Lawrence H. Goulder1; Robert N. Stavins2

1 Department of Economics, Stanford University, Landau Economics Building, Stanford University, Stanford, CA 94305. · 2 John F. Kennedy School of Government, Harvard University, 79 John F. Kennedy St., Cambridge, MA 02138.

Abstract

With a focus on two sorts of regulation—renewable electricity and clean energy standards, and automobile fuel-economy standards—we analyze problematic interactions that arise when state policies are nested within the domain of Federal policy. Here state efforts may fail to reduce greenhouse gas emissions nationally, and may compromise cost-effectiveness. Difficulties from overlapping regulations are avoidable through price- (as opposed to quantity-) based Federal policy. We identify some potentially positive interactions between state and Federal policies, and identify rationales for state action when Federal and state policies do not overlap.

DOI
10.1257/aer.101.3.253
Volume
101
Issue
3
Pages
253-257
Language
en
Sources
bibtex:phds-export.bib crossref openalex

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