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Performative State Capacity and Climate (In)Action

Author

Listed:
  • Feld, Immanuel

    (University of Warwick)

  • Fetzer, Thiemo

    (University of Warwick & Bonn and affiliated with CEPR, CAGE, NIESR, ECONtribute, Grantham Institute)

Abstract

Climate action requires significant public- and private sector investment to achieve meaningful reductions in carbon emissions. This paper documents that large-scale austerity, coupled with barriers to flows of data and a lack of (digital) skills in (local) government, may have been a significant barrier to delivering climate action in the form of retrofitting. Decomposing heterogeneity in estimated treatment effects of a large-scale energy efficiency savings program that was rolled out through a regression discontinuity design in the early 2010s, we find that both the extent of austerity-induced local budget cuts and poor digital connectivity – may be responsible for up to 30% fewer retrofit installations that counterfactually would have taken place had it not been for austerity

Suggested Citation

  • Feld, Immanuel & Fetzer, Thiemo, 2024. "Performative State Capacity and Climate (In)Action," CAGE Online Working Paper Series 708, Competitive Advantage in the Global Economy (CAGE).
    • Handle: RePEc:cge:wacage:708
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    File URL: https://warwick.ac.uk/fac/soc/economics/research/centres/cage/manage/publications/wp708.2024.pdf
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    More about this item

    Keywords

    state capacity; austerity; skills; climate action; public economics JEL Classification: Q54; Q58; H76; C21; O33; R11; H54;
    All these keywords.

    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • H76 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Other Expenditure Categories
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures

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