Question A:
Government subsidies for investment in green technologies are justified by substantial benefits coming from reducing unpriced carbon emissions and generating positive R&D spillovers.
Responses
Responses weighted by each expert's confidence
Question B:
Using subsidies for green technologies instead of full carbon prices will lead to substantially more rent-seeking and hence substantially higher costs to achieve a given reduction in emissions.
Responses
Responses weighted by each expert's confidence
Question A Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
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 Franklin Allen |
Imperial College London | Bio/Vote History | ||
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The externalities are difficult to measure but the costs of not doing much seem large.
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 Pol Antras |
Harvard | Bio/Vote History | ||
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It's certainly built into many models of innovation in clean technologies. Work by a job-market candidate at BU (Eric Donald) provides some evidence.
-see background information here |
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 Olivier Blanchard |
Peterson Institute | Bio/Vote History | ||
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 Nicholas Bloom |
Stanford | Did Not Answer | Bio/Vote History | |
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 Richard William Blundell |
University College London | Bio/Vote History | ||
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 Maristella Botticini |
Bocconi | Bio/Vote History | ||
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 Agnès Bénassy-Quéré |
Paris School of Economics | Bio/Vote History | ||
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 Elena Carletti |
Bocconi | Bio/Vote History | ||
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 Jean-Pierre Danthine |
Paris School of Economics | Bio/Vote History | ||
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 Paul De Grauwe |
LSE | Bio/Vote History | ||
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 Jan Eeckhout |
UPF Barcelona | Bio/Vote History | ||
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Better than nothing but inferior to carbon pricing: the price system is better at picking right technologies. In addition, while subsidies create a wedge between brown and green technology, they tend to lower the average price of energy, whereas optimal policy should raise prices
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 Ernst Fehr |
Universität Zurich | Did Not Answer | Bio/Vote History | |
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 Xavier Freixas |
Barcelona GSE | Did Not Answer | Bio/Vote History | |
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 Nicola Fuchs-Schündeln |
Goethe-Universität Frankfurt | Bio/Vote History | ||
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 Jordi Galí |
Barcelona GSE | Bio/Vote History | ||
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 Luis Garicano |
LSE | Did Not Answer | Bio/Vote History | |
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 Yuriy Gorodnichenko |
Berkeley | Did Not Answer | Bio/Vote History | |
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 Rachel Griffith |
University of Manchester | Bio/Vote History | ||
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 Veronica Guerrieri |
Chicago Booth | Bio/Vote History | ||
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 Luigi Guiso |
Einaudi Institute for Economics and Finance | Bio/Vote History | ||
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 Sergei Guriev |
Sciences Po | Bio/Vote History | ||
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 Patrick Honohan |
Trinity College Dublin | Bio/Vote History | ||
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 Beata Javorcik |
University of Oxford | Bio/Vote History | ||
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 Jan Pieter Krahnen |
Goethe University Frankfurt | Bio/Vote History | ||
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In principle I agree. But the devil is in the details: How to design a support scheme that does not discriminate between different technological methods, thereby allowing innovations to develop.
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 Botond Kőszegi |
Central European University | Did Not Answer | Bio/Vote History | |
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 Eliana La Ferrara |
Harvard Kennedy | Did Not Answer | Bio/Vote History | |
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 Christian Leuz |
Chicago Booth | Bio/Vote History | ||
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There are two externalities (carbon damages and R&D spillovers) so providing some subsidies would make sense, but would combine with carbon taxes. Necessary level of subsidies is hard to determine (info asymmetry), as is which technologies to subsidize.
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 Thierry Mayer |
Sciences-Po | Did Not Answer | Bio/Vote History | |
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 Costas Meghir |
Yale | Bio/Vote History | ||
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 Marco Pagano |
Università di Napoli Federico II | Bio/Vote History | ||
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 Lubos Pastor |
Chicago Booth | Bio/Vote History | ||
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Better technology for renewable energy is the best way to reduce carbon emissions globally and in the long run
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 Torsten Persson |
Stockholm University | Did Not Answer | Bio/Vote History | |
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 Christopher Pissarides |
London School of Economics and Political Science | Did Not Answer | Bio/Vote History | |
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 Richard Portes |
London Business School | Bio/Vote History | ||
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 Canice Prendergast |
Chicago Booth | Bio/Vote History | ||
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 Carol Propper |
Imperial College London | Bio/Vote History | ||
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 Imran Rasul |
University College London | Bio/Vote History | ||
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 Lucrezia Reichlin |
London Business School | Bio/Vote History | ||
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 Ricardo Reis |
London School of Economics | Bio/Vote History | ||
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But how to prevent them subsidizing the "wrong" green investments?
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 Rafael Repullo |
CEMFI | Bio/Vote History | ||
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 Hélène Rey |
London Business School | Did Not Answer | Bio/Vote History | |
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 Antoinette Schoar |
MIT | Bio/Vote History | ||
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The benefits depend on how well these subsidies are targeted to firms and projects that have potentially large spill overs.
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 Kjetil Storesletten |
University of Minnesota | Did Not Answer | Bio/Vote History | |
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 Daniel Sturm |
London School of Economics | Bio/Vote History | ||
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 John Van Reenen |
LSE | Bio/Vote History | ||
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First best is high enough carbon tax, but this is not politically feasible, so complementing this with green subsidies (especially for clean R&D) is valuable
-see background information here |
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 Rick Van der Ploeg |
Oxford | Bio/Vote History | ||
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 John Vickers |
Oxford | Did Not Answer | Bio/Vote History | |
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 Hans-Joachim Voth |
University of Zurich | Bio/Vote History | ||
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 Karl Whelan |
University College Dublin | Bio/Vote History | ||
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 Charles Wyplosz |
The Graduate Institute Geneva | Bio/Vote History | ||
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Question B Participant Responses
| Participant | University | Vote | Confidence | Bio/Vote History |
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Franklin Allen |
Imperial College London | Bio/Vote History | ||
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It depends how the policies are designed and enforced. The results of the policies could go either way.
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Pol Antras |
Harvard | Bio/Vote History | ||
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Unless subsidies are based on objective, measurable criteria.
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Olivier Blanchard |
Peterson Institute | Bio/Vote History | ||
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Nicholas Bloom |
Stanford | Did Not Answer | Bio/Vote History | |
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Richard William Blundell |
University College London | Bio/Vote History | ||
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Maristella Botticini |
Bocconi | Bio/Vote History | ||
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Agnès Bénassy-Quéré |
Paris School of Economics | Bio/Vote History | ||
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Both instruments need to be combined
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Elena Carletti |
Bocconi | Bio/Vote History | ||
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Jean-Pierre Danthine |
Paris School of Economics | Bio/Vote History | ||
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Paul De Grauwe |
LSE | Bio/Vote History | ||
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Jan Eeckhout |
UPF Barcelona | Bio/Vote History | ||
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Ernst Fehr |
Universität Zurich | Did Not Answer | Bio/Vote History | |
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Xavier Freixas |
Barcelona GSE | Did Not Answer | Bio/Vote History | |
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Nicola Fuchs-Schündeln |
Goethe-Universität Frankfurt | Bio/Vote History | ||
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Jordi Galí |
Barcelona GSE | Bio/Vote History | ||
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Luis Garicano |
LSE | Did Not Answer | Bio/Vote History | |
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Yuriy Gorodnichenko |
Berkeley | Did Not Answer | Bio/Vote History | |
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Rachel Griffith |
University of Manchester | Bio/Vote History | ||
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Veronica Guerrieri |
Chicago Booth | Bio/Vote History | ||
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Luigi Guiso |
Einaudi Institute for Economics and Finance | Bio/Vote History | ||
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Sergei Guriev |
Sciences Po | Bio/Vote History | ||
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Patrick Honohan |
Trinity College Dublin | Bio/Vote History | ||
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And the all-embracing nature of the carbon tax approach is far superior for steering innovation.
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Beata Javorcik |
University of Oxford | Bio/Vote History | ||
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Jan Pieter Krahnen |
Goethe University Frankfurt | Bio/Vote History | ||
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Botond Kőszegi |
Central European University | Did Not Answer | Bio/Vote History | |
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Eliana La Ferrara |
Harvard Kennedy | Did Not Answer | Bio/Vote History | |
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Christian Leuz |
Chicago Booth | Bio/Vote History | ||
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Directionally agree. Key problem is info asymmetry b/w government & private sector about which investments would be taken only w/ subsidies. Some rents are unavoidable. Magnitude of rents is difficult to know. Bigger problem is govt picking technology, thus basic research better
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Thierry Mayer |
Sciences-Po | Did Not Answer | Bio/Vote History | |
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Costas Meghir |
Yale | Bio/Vote History | ||
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Marco Pagano |
Università di Napoli Federico II | Bio/Vote History | ||
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Lubos Pastor |
Chicago Booth | Bio/Vote History | ||
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There will be some rent seeking, but all in all, better technology for renewable energy is the best way to reduce carbon emissions globally and in the long run
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Torsten Persson |
Stockholm University | Did Not Answer | Bio/Vote History | |
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Christopher Pissarides |
London School of Economics and Political Science | Did Not Answer | Bio/Vote History | |
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Richard Portes |
London Business School | Bio/Vote History | ||
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Canice Prendergast |
Chicago Booth | Bio/Vote History | ||
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Carol Propper |
Imperial College London | Bio/Vote History | ||
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Imran Rasul |
University College London | Bio/Vote History | ||
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Lucrezia Reichlin |
London Business School | Bio/Vote History | ||
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Ricardo Reis |
London School of Economics | Bio/Vote History | ||
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Rafael Repullo |
CEMFI | Bio/Vote History | ||
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Hélène Rey |
London Business School | Did Not Answer | Bio/Vote History | |
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Antoinette Schoar |
MIT | Bio/Vote History | ||
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Kjetil Storesletten |
University of Minnesota | Did Not Answer | Bio/Vote History | |
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Daniel Sturm |
London School of Economics | Bio/Vote History | ||
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John Van Reenen |
LSE | Bio/Vote History | ||
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There are dangers of rent-seeking, but they can be reduced by a sensible industrial policy. The alternative of failing to deal with climate crisis is far worse.
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Rick Van der Ploeg |
Oxford | Bio/Vote History | ||
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John Vickers |
Oxford | Did Not Answer | Bio/Vote History | |
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Hans-Joachim Voth |
University of Zurich | Bio/Vote History | ||
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Karl Whelan |
University College Dublin | Bio/Vote History | ||
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Charles Wyplosz |
The Graduate Institute Geneva | Bio/Vote History | ||
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