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Implications of Alternative Mitigation Policies on World Prices for Fossil Fuels and Agricultural Products

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  • Sergey Paltsev
Abstract
Emissions mitigation policies affect prices, including prices for fossil fuels and agricultural products. Consumer prices for coal and natural gas are expected to rise when climate policy is implemented, while oil prices may be reduced or remain the same in comparison to a no policy scenario. Impacts on agricultural prices are more controversial as reduced negative productivity impacts on yields are compensated by increased costs of energy inputs to agriculture, lower CO2 fertilization effect, and a competition for land from biofuels.

Suggested Citation

  • Sergey Paltsev, 2012. "Implications of Alternative Mitigation Policies on World Prices for Fossil Fuels and Agricultural Products," WIDER Working Paper Series wp-2012-065, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:wp-2012-065
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    1. Ronald Prinn & Sergey Paltsev & Andrei Sokolov & Marcus Sarofim & John Reilly & Henry Jacoby, 2011. "Scenarios with MIT integrated global systems model: significant global warming regardless of different approaches," Climatic Change, Springer, vol. 104(3), pages 515-537, February.
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    3. Gurgel Angelo & Reilly John M & Paltsev Sergey, 2007. "Potential Land Use Implications of a Global Biofuels Industry," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 5(2), pages 1-36, December.
    4. Nelson, Gerald C. & Rosegrant, Mark W. & Palazzo, Amanda & Gray, Ian & Ingersoll, Christina & Robertson, Richard & Tokgoz, Simla & Zhu, Tingju & Sulser, Timothy B. & Ringler, Claudia & Msangi, Siwa & , 2010. "Food security, farming, and climate change to 2050: Scenarios, results, policy options," Research reports Gerald C. Nelson, et al., International Food Policy Research Institute (IFPRI).
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    7. Angelo Gurgel & Tim Cronin & John Reilly & Sergey Paltsev & David Kicklighter & Jerry Melillo, 2011. "Food, Fuel, Forests, and the Pricing of Ecosystem Services," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 93(2), pages 342-348.
    8. Reilly, J. & Paltsev, S. & Felzer, B. & Wang, X. & Kicklighter, D. & Melillo, J. & Prinn, R. & Sarofim, M. & Sokolov, A. & Wang, C., 2007. "Global economic effects of changes in crops, pasture, and forests due to changing climate, carbon dioxide, and ozone," Energy Policy, Elsevier, vol. 35(11), pages 5370-5383, November.
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    Cited by:

    1. Sergey Paltsev & Pantelis Capros, 2013. "Cost Concepts For Climate Change Mitigation," Climate Change Economics (CCE), World Scientific Publishing Co. Pte. Ltd., vol. 4(supp0), pages 1-26.
    2. Lourenço Manuel & Orcídia Chiziane & Gaby Mandhlate & Faaiqa Hartley & Emílio Tostão, 2021. "Impact of climate change on the agriculture sector and household welfare in Mozambique: an analysis based on a dynamic computable general equilibrium model," Climatic Change, Springer, vol. 167(1), pages 1-18, July.
    3. Channing Arndt & Finn Tarp, 2015. "Climate change impacts and adaptations: lessons learned from the greater Zambeze River Valley and beyond," Climatic Change, Springer, vol. 130(1), pages 1-8, May.
    4. Thomas W. Hertel & Jevgenijs Steinbuks & Wallace E. Tyner, 2016. "What Is the Social Value of Second Generation Biofuels?," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 38(4), pages 599-617.
    5. Ramberg, David J. & Henry Chen, Y.H. & Paltsev, Sergey & Parsons, John E., 2017. "The economic viability of gas-to-liquids technology and the crude oil–natural gas price relationship," Energy Economics, Elsevier, vol. 63(C), pages 13-21.
    6. Sergey Paltsev, 2016. "Energy Scenarios: The Value and Limits of Scenario Analysis," EcoMod2016 9371, EcoMod.
    7. Channing Arndt & James Thurlow, 2015. "Climate uncertainty and economic development: evaluating the case of Mozambique to 2050," Climatic Change, Springer, vol. 130(1), pages 63-75, May.
    8. Ada Ignaciuk & Daniel Mason-D'Croz, 2014. "Modelling Adaptation to Climate Change in Agriculture," OECD Food, Agriculture and Fisheries Papers 70, OECD Publishing.
    9. Baldos, Uris Lantz & Thomas Hertel, 2014. "Bursting the Bubble: A Long Run Perspective on Crop Commodity Prices," GTAP Working Papers 4574, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
    10. Taran Faehn & Gabriel Bachner & Robert Beach & Jean Chateau & Shinichiro Fujimori & Madanmohan Ghosh & Meriem Hamdi-Cherif & Elisa Lanzi & Sergey Paltsev & Toon Vandyck & Bruno Cunha & Rafael Garaffa , 2020. "Capturing Key Energy and Emission Trends in CGE models: Assessment of Status and Remaining Challenges," Journal of Global Economic Analysis, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, vol. 5(1), pages 196-272, June.
    11. Channing Arndt & Paul Chinowsky & Charles Fant & Sergey Paltsev & C. Adam Schlosser & Kenneth Strzepek & Finn Tarp & James Thurlow, 2019. "Climate change and developing country growth: the cases of Malawi, Mozambique, and Zambia," Climatic Change, Springer, vol. 154(3), pages 335-349, June.
    12. Peterson, Sonja & Weitzel, Matthias, 2014. "Reaching a climate agreement: Do we have to compensate for energy market effects of climate policy?," Kiel Working Papers 1965, Kiel Institute for the World Economy (IfW Kiel).
    13. Sergey Paltsev, 2017. "Energy scenarios: the value and limits of scenario analysis," Wiley Interdisciplinary Reviews: Energy and Environment, Wiley Blackwell, vol. 6(4), July.
    14. Makarov, Igor & Chen, Y.-H. Henry & Paltsev, Sergey, 2018. "Finding itself in the post-Paris world: Russia in the new global energy landscape," Conference papers 332984, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.

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    Keywords

    Agriculture; Climate change; Economic equilibrium; Prices;
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