CEU Electronic Theses and Dissertations, 2024
| Author | Muth, Daniel |
|---|---|
| Title | Pathways to Stringent Carbon Pricing: Configurations of Political Economy Conditions and Revenue Recycling Strategies |
| Summary | The landmark Paris Agreement was set forth in 2015 to keep global warming, with its dangerous consequences, well below two degrees. In order to achieve this strenuous target, greenhouse gas emissions need to be reduced drastically, on a global scale. There is general agreement among economists and climate policy practitioners that carbon pricing should play a central role in tackling climate change effectively. However, prevailing price levels, in most jurisdictions that have adopted carbon pricing policies, are considered too low to accelerate decarbonization or drive emissions down drastically. The difference between our current prices and the prices aspired to by the scientific community in order to keep the changing climate at a safe and tolerable level, produces the carbon price gap. This gap is largely caused by political economy constraints, especially the policies’ negative distributional impact, which results in fierce resistance from the public and businesses to carbon pricing in general. In turn, this creates a political stalemate and keeps the carbon price levels too low, inhibiting these climate policies from exerting the positive environmental outcome they, in theory, are designed to deliver. My claim is that this political impasse can be overcome, or successfully mitigated, by correctly and wisely utilizing a unique benefit from this climate policy – the proceeds it earns, in a process known as revenue recycling. Through various mechanisms, such as compensating adversely affected groups, and ‘green’ coalition-building financed by different revenue-recycling schemes, persistent political economy constraints can be alleviated to make carbon pricing politically more appealing to various socioeconomic groups. Enhanced acceptance, ultimately, can enable the implementation of more stringent policies. However, as countries differ in their socioeconomic environments, revenue recycling needs to adequately address the local political economy situation and hurdles. For this reason, a cross-case analysis is necessary to examine which revenue recycling strategies are effective in alleviating political economy constraints in various environments. These assumptions are then tested empirically through a multi-method research design. The Introduction, Chapter 1, presents the context of the research, the main inquiry the dissertation aims to address, as well as the scientific and societal relevance of the project. Chapter 2 introduces carbon pricing theory, and puts forth the argument that a holistic approach, combining different strands of literature, including insights from classic political economy, and the recently-emerged field of ecological economics and political ecology, is better suited to assess climate policy effectiveness than neoclassical economic accounts. The delineated Theoretical Framework in Chapter 3 takes the novel approach of analyzing carbon pricing stringency through constellations of structural political economy conditions and various revenue recycling measures. Chapter 4 details the research design and applied methodologies to fulfill the research objectives. It demonstrates why fuzzy-set Qualitative Comparative Analysis (QCA) is an ideal method for the developed intersectional model. Additionally, this fourth chapter explains how the subsequent process tracing case study helps corroborate and refine the inferences based on QCA. The empirical chapters begin with Chapter 5, presenting the comparison of thirty national-level carbon pricing mechanisms. This is followed by an in-depth case study on the Irish carbon tax reform (Chapter 6), investigating how revenue recycling is causally linked to stringent policy outcome. The dissertation ends with Chapter 7, setting forth numerous, ready-to-implement policy directions, derived from both QCA analyses and case studies, as well as suggestions for future research. |
| Supervisor | Weiler, Florian |
| Department | Political Science PhD |
| Full text | https://www.etd.ceu.edu/2024/muth_daniel.pdf |
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