skip to content

Faculty of Economics

Journal Cover

Newbery, D. M.

Oil shortages, climate change and collective action.

Philosophical Transactions of the Royal Society A

Vol. 369 pp. 1748-1761 (2011)

Abstract: Concerns over future oil scarcity might not be so worrying but for the high carbon content of substitutes, and the limited capacity of the atmosphere to absorb additional CO2 from burning fuel. The paper argues that the tools of economics are helpful in understanding some of the key issues in pricing fossil fuels, the extent to which pricing can be left to markets, the need for, and design of, international agreements on corrective carbon pricing, and the potential Prisoners’ Dilemma in reaching such agreements, partly mitigated in the case of oil by current taxes and the probable incidence of carbon taxes on the oil price. The ‘Green Paradox’, in which carbon pricing exacerbates climate change, is theoretically possible, but empirically unlikely.

JEL Codes: Q02, Q47, Q54

Author links: David Newbery  

Publisher's Link: http://rsta.royalsocietypublishing.org/content/369/1942/1748



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 [2023]

Huffman, D., Raymond, C. and Shvets, J. Persistent Overconfidence and Biased Memory: Evidence from Managers American Economic Review [2022]

Ajzenman, N., Cavalcanti, T. and Da Mata, D More than Words: Leaders' Speech and Risky Behavior During a Pandemic American Economic Journal: Economic Policy [2023]

Carneiro, P., Liu, K. and Salvanes, K. G. The Supply of Skill and Endogenous Technical Change: Evidence from a College Expansion Reform Journal of the European Economic Association [2023]