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Faculty of Economics

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Ritz, R. and Hahn, R.

Does the social cost of carbon matter?

Journal of Legal Studies


Abstract: We evaluate a recent u.s. initiative to include the social cost of carbon (sCc) in regulatory decisions. To our knowledge, this paper provides the first systematic test of the extent to which applying the SCC has affected national policy. we examine all economically significant federal regulations since 2008, and obtain a surprising result: Putting a value on changes in carbon dioxide emissions does not generally affect the ranking of the preferred policy compared with the status quo. overall, we find little evidence that use of the SCC has affected u.s. policy choices to date. we offer an explanation related to the political economy of regulation.

Keywords: Cost-Benefit Analysis, Social Cost of Carbon, Climate Policy, Regulatory Innovation

JEL Codes: H43, K32, Q51, Q58

Author links: Robert Ritz  

Cambridge Working Paper in Economics Version of Paper: Does the social Cost of Carbon Matter?: An Assessment of U.S. Policy, Hahn, R. and Ritz, R., (2013)

Papers and Publications

Recent Publications

Bhattacharya, D., Dupas, P. and Kanaya, S. Demand and Welfare Analysis in Discrete Choice Models with Social Interactions Review of Economic Studies, accepted [2023]

Bhattacharya, D. The Empirical Content of Binary Choice Models Econometrica [2021]

Evans, R. A. and Reiche, S. K. When Is a Contrarian Adviser Optimal? American Economic Journal: Microeconomics [2023]

Corsetti, G., Crowley, M. A. and Han, L. Invoicing and the Dynamics of Pricing-to-Market: Evidence from UK Export Prices around the Brexit Referendum Journal of International Economics [2022]