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Quantifying supply-side climate policies

Author

Listed:
  • Lassi Ahlvik
  • Jørgen Juel Andersen
  • Jonas Hveding Hamang
  • Torfinn Harding

Abstract

What are the effects of supply-side climate policies? We use global firm-level data to estimate the impact of 130 oil-tax reforms between 2000 and 2019 on oil production, exploration and discoveries. Higher taxes are found to reduce firms exploration expenditures and oil discoveries. We quantify the oil market implications and show that the existing productionbased taxes, averaging at 21%, reduce the long-term emissions by 1.3-2.7 GtCO2 annually. Increasing the global tax rate would reduce emissions almost linearly, by 0.16 GtCO2 per percentage point, while further shifting the distribution of rents from consumers to producers and governments.

Suggested Citation

  • Lassi Ahlvik & Jørgen Juel Andersen & Jonas Hveding Hamang & Torfinn Harding, 2022. "Quantifying supply-side climate policies," Working Papers No 01/2022, Centre for Applied Macro- and Petroleum economics (CAMP), BI Norwegian Business School.
    • Handle: RePEc:bny:wpaper:0104
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    File URL: https://hdl.handle.net/11250/2983258
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    References listed on IDEAS

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    Cited by:

    1. Hamang, Jonas, 2024. "Economic development and known natural resource endowment: Discovery rate differentials of oil," Journal of Development Economics, Elsevier, vol. 170(C).
    2. van den Bijgaart, Inge & Rodriguez, Mauricio, 2023. "Closing wells: Fossil development and abandonment in the energy transition," Resource and Energy Economics, Elsevier, vol. 74(C).

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    Keywords

    oil taxation; climate change; supply-side climate policies;
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