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Everyone knows that our climate is changing, but less is known about the social impacts of climate change and the effectiveness of programs and economic instruments to mitigate it. A solution to climate change is to develop economic incentives and instruments which correct for externalities associated with climate change. Some of our work looks at why the economic instruments that are generally not preferred by economists are often implemented in favour of those that are. Work by members of the group (O Donoghue, Lupsik) investigates the effects of climate change regulation such as a carbon levy on the welfare of Irish citizens. Our particular focus is on climate and renewable energy but also on an understanding of how ecosystems can contribute toward climate change mitigation, through for example carbon sequestration by carbon sinks such as forests or the oceans. Much of the impact of climate change on society will be mediated through the price of energy. One goal of our group is to consider the costs of alternative sources of energy such as marine renewable energy. Niall Farrell and Cathal O Donoghue are engaged in research on this topic.
One of the areas of research in ENRE is the evaluation of the effectiveness of public fiscal policies in achieving pollutionreduction objectives and the economic and social impact of these policies. Members of the unit have undertaken studies which have examined the impact in Ireland of an EU proposal in the early 1990's for the implementation of Pigouvian carbon taxes, particularly on the cost implications for different industrial sectors and on the redistributive impact of such taxation. Microsimulation models such as the SMILE model developed by Cathal O Donoghue have been used to examine these issues.
Members of the unit are involved in a study that evaluates existing fiscal policies that aim to encourage the reduction of greenhouse gas emissions in Ireland and Estonia. In the agricultural sector, other work has focused on the contribution of the national herd to the levels of methane production and an examination, using cost-benefit methods, of policies that would reduce the emissions of these gasses.
Niall Farrell
O'Donoghue, C. 1997 Carbon dioxide, energy taxes and household income, ESRI Working Paper No. 90 Dublin.
O'Donoghue, C. 1997. Carbon dioxide, energy taxation and industry: An input-output analysis, ESRI Working Paper No. 82 Published by the ESRI Dublin.
