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GHG Emissions Control and Monetary Policy

Author

Listed:
  • Barbara Annicchiarico

    (Università di Roma Tor Vergata)

  • Fabio Di Dio

    (Sogei S.p.A.)

Abstract

This paper examines the optimal environmental and monetary policy mix in a New Keynesian model embodying pollutant emissions, abatement technology and environmental damage. The optimal response of the economy to productivity shocks is shown to depend crucially on the instruments policy makers have available, the intensity of the distortions they have to address (i.e. imperfect competition, costly price adjustment and negative environmental externality) and the way they interact.

Suggested Citation

  • Barbara Annicchiarico & Fabio Di Dio, 2017. "GHG Emissions Control and Monetary Policy," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 67(4), pages 823-851, August.
    • Handle: RePEc:kap:enreec:v:67:y:2017:i:4:d:10.1007_s10640-016-0007-5
    DOI: 10.1007/s10640-016-0007-5
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    More about this item

    Keywords

    GHG emissions control policy; Monetary policy; Ramsey problem;
    All these keywords.

    JEL classification:

    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy

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