Robert N. Stavins

"Positive Political Economy of Instrument Choice in Environmental Regulation"

Discussion Paper

By Robert N. Stavins, Albert Pratt Professor of Business and Government; Member of the Board; Director, Harvard Project on Climate Agreements

In the realm of environmental policy instrument choice, there is great divergence between the recommendations of normative economic theory and positive political reality. Four gaps stand out. First, despite the advantages of market-based policy instruments, they have been used to a minor degree, compared with conventional, command-and-control instruments. Second, pollution-control standards have typically been much more stringent for new than for existing sources, despite the inefficiency of this approach. Third, in the few instances in which market-based instruments have been adopted, they have nearly always taken the form of grandfathered tradeable permits, rather than auctioned permits or pollution taxes, despite the advantages in some situations of these other instruments. Fourth, the political attention given to market-based environmental policy instruments has increased dramatically in recent years. We search for explanations for these four apparent anomalies by drawing upon intellectual traditions from economics, political science, and law.

"Next Generation of Market-Based Environmental Policies"

Discussion Paper

By Robert N. Stavins, Albert Pratt Professor of Business and Government; Member of the Board; Director, Harvard Project on Climate Agreements

We examine what will be required if market-based environmental policy instruments are to become a major force in U.S. environmental policy. These instruments are by no means a new policy idea. Indeed, over the past two decades they have held varying degrees of prominence on the environmental policy landscape, due, in part, to the fact that they are an attractive policy instrument in both theory and practice. But market-based instruments have failed to meet the great expectations that have often been set for them. They are currently only on the peripheries of environmental policy and, when they have been implemented, they frequently have not performed as predicted. Does this represent yet another breakdown between policy theory and policy practice? Was the effort to transform environmental regulations with these tools nothing more than quixotic tilting at windmills and is it time to return to more established -- if expensive -- policy mechanisms?

"Experience with Market-Based Environmental Policy Instruments"

Discussion Paper

By Robert N. Stavins, Albert Pratt Professor of Business and Government; Member of the Board; Director, Harvard Project on Climate Agreements

Environmental policies typically combine the identification of a goal with some means to achieve that goal. This paper, prepared as a chapter draft of the forthcoming Handbook of Environmental Economics, focuses exclusively on the second component, the means -- the "instruments" -- of environmental policy, and considers, in particular, experience around the world with the relatively new breed of economic-incentive or market-based policy instrumens. The author defines these instruments broadly, and considers them within four categories: pollution charges, tradable permits; market barrier reductions; and government subsidy reductions. By defining market-based instruments broadly, the author casts a large net for this review of applications. As a consequence, the review is extensvie. But this should not leave the impression that market-baseed instruments have replaced, or have come anywhere close to replacing, the conventional, command-and-control approach to environmental protection. Further, even when and where these approaches have been used in their purest form and with some success, such as in the case of tradeable permit systems int he United States, they have not always performed as anticipated. In the final part of the paper, the author asks what lessons can be learned from our experiences. In particular, the paper considers normative lessons for: design and implementation; analysis of prospective and adopted systems; and identification of new applications.

"Readings in the Field of Natural Resource and Environmental Economics"

Discussion Paper

By Robert N. Stavins, Albert Pratt Professor of Business and Government; Member of the Board; Director, Harvard Project on Climate Agreements

This is the latest version of a document periodically produced sine the early 1980s. It combines an outline of the field of natural rseouce and enviornmental economics with a bibliography of 945 references. In the past, this reading list has been used in a variety of ways: as a guide to the literature for graduate students in departments of economics which do not offer a Ph.D.-level survey course of the field; as a resource for Ph.D. students who wish to devleop a directed readings course in theild; and as an aid to students at the amsters and undergraduate levels who wish to explore selected areas in greater depth.

"Economic Incentives for Environmental Regulation"

Discussion Paper

By Robert N. Stavins, Albert Pratt Professor of Business and Government; Member of the Board; Director, Harvard Project on Climate Agreements

Environmental policies consits of two components: the identification of an overall goal and some means to achieve that goal. This essay considers the second component, the means- the "instruments"--of environmental policy, and it focuses, in particular, on the use of economic-incentive or market-based policy instruments.

"Incentives Based Environment Regulation: A New Era from an Old Idea?"

Discussion Paper

By Robert N. Stavins, Albert Pratt Professor of Business and Government; Member of the Board; Director, Harvard Project on Climate Agreements

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"What has Kyoto Wrought? The Real Architecture of International Tradeable Permits"

Discussion Paper

By Robert N. Stavins, Albert Pratt Professor of Business and Government; Member of the Board; Director, Harvard Project on Climate Agreements and Robert W. Hahn

The authors investigate a central issue in the climate change debate associated with the Kyoto Protocol: the likely performance of international greenhouse gas trading mechanisms. Virtually all design studies and many projections of the costs of meeting the Kyoto targets have assumed that an international trading program can be established that minimizes the costs of meeting overall goals. This conclusion rests on several simplifying assumptions. The authors focus on one important issue that has received little, if any, attention: the interation between an international trading regime and a heterogeneous set of domestic greenhouse policy instruments. This is an important issue because the Protocol explicitly provides for domestic sovereignty reagrding instrument choice, and because it is unlikely that most countries will choose tradeable permits as their primary domestic vehicle.

AP Photo

November 20, 2008

Obama's Speech on a U.S. Cap-and-Trade System and Global Climate Negotiations

In the News

By Robert N. Stavins, Albert Pratt Professor of Business and Government; Member of the Board; Director, Harvard Project on Climate Agreements

Robert N. Stavins, Harvard Kennedy School professor and co-director of the Harvard Project on International Climate Agreements, offered insight and analysis on President-Elect Barack Obama's speech on climate change which was delivered Nov. 18, 2008.

AP Photo

August 31, 2012

"Climate Negotiators Create an Opportunity for Scholars"

Journal Article, Science, issue 6098, volume 337

By Joseph E. Aldy, Faculty Affiliate, Harvard Project on Climate Agreements and Robert N. Stavins, Albert Pratt Professor of Business and Government; Member of the Board; Director, Harvard Project on Climate Agreements

The 1992 United Nations Framework Convention on Climate Change (UNFCCC) launched a process to confront risks posed by global climate change. It has led to a dichotomy between countries with serious emission-reduction responsibilities and others with no responsibilities whatsoever. This has prevented progress, but the Durban Platform for Enhanced Action suggests the prospect for a better way forward and an openness to outside-the-box thinking. Scholars and practitioners have a new opportunity to contribute innovative proposals for a future international climate policy architecture.

AP Photo

Enero–Marzo de 2011

"¿Qué sucedió (y por qué)? Una evaluación de los Acuerdos de Cancún"

Journal Article, Foreign Affairs Latinoamerica, issue 1, volume 11

By Robert N. Stavins, Albert Pratt Professor of Business and Government; Member of the Board; Director, Harvard Project on Climate Agreements

Las negociaciones internacionales sobre el clima que se llevaron a cabo en Cancún, México, han concluido, y a pesar de las fatídicas predicciones que dominaron las semanas y los meses previos a dicha reunión, se debe considerar que la xvi Conferencia de las Partes (COP-16) de la Convención Marco de Nacio — nes Unidas sobre Cambio Climático (CMNUCC) fue un éxito. Representa un modesto avance. No se debe esperar nada más de este proceso.