Karp, LarryStevenson, Megan2013-01-032013-01-032012-10https://hdl.handle.net/10986/12081This paper studies the reality and the potential for green industrial policy. It provides a summary of the green industrial policies, broadly understood, for five countries. It then considers the relation between green industrial policies and trade disputes, emphasizing the Brazil-United States dispute involving ethanol and the broader United States-China dispute. The theory of public policy provides many lessons for green industrial policy. The authors highlight four of these lessons, involving the Green Paradox, the choice of quantities versus prices with endogenous investment, the coordination issues arising from emissions control, and the ability of green industrial policies to promote cooperation in reducing a global public bad like carbon emissions.en-USCC BY 3.0 IGOABATEMENTABATEMENT COSTSABSORPTIONAGGREGATE DEMANDAGGREGATE EMISSIONSAGGREGATE LEVELALLOWANCEALTERNATIVE ENERGYALTERNATIVE FUELSAMOUNT OF ABATEMENTAMOUNT OF EMISSIONSAPPROACHARBITRAGEASYMMETRIC INFORMATIONAVAILABILITYAVERAGE PRODUCTION COSTSBALANCEBIOGASBIOMASSBIRDSCALCULATIONCAP AND TRADE POLICYCARBONCARBON EMISSIONSCARBON ENERGYCARBON POLICIESCARBON STOCKSCARBON TAXCARBON TAXESCLIMATECLIMATE CHANGECLIMATE CHANGE MITIGATIONCLIMATE SYSTEMCLOUDSCOCONSUMERSCORN PRICESCOST OF ABATEMENTDAMAGESDEBTDEFORESTATIONDEMAND FOR ETHANOLDEVELOPED COUNTRIESDEVELOPMENT ECONOMICSDEVELOPMENT POLICYDISCOUNT RATEDISCOUNTED VALUEDUMPINGDYNAMIC MODELECONOMIC BENEFITSECONOMIC THEORYECONOMIES OF SCALEECONOMISTSELECTRICITYELECTRICITY GENERATIONEMISSIONSEMISSIONS CONTROLEMISSIONS POLICYEMISSIONS REDUCTIONEMISSIONS TAXESEMPIRICAL EVIDENCEENERGY DEMANDENERGY ECONOMICSENERGY POLICIESENERGY POLICYENERGY SOURCEENERGY SOURCESENERGY SUPPLYENERGY USEENVIRONMENTALENVIRONMENTAL CONSEQUENCESENVIRONMENTAL COSTSENVIRONMENTAL DAMAGESENVIRONMENTAL ECONOMICSENVIRONMENTAL ECONOMISTSENVIRONMENTAL POLICYENVIRONMENTAL PROBLEMENVIRONMENTAL PROBLEMSENVIRONMENTAL REGULATIONEQUILIBRIUMETHANOLETHANOL IMPORTSETHANOL IN GASOLINEETHANOL INDUSTRYETHANOL PRODUCTIONETHANOL TAX CREDITEXCHANGE RATEEXPECTED VALUEEXPORTSEXTERNALITIESEXTERNALITYFARMSFISCAL POLICIESFIXED COSTSFOREIGN COMPETITIONFOSSILFOSSIL FUELFOSSIL FUELSFUEL CONSUMPTIONFUEL COSTSFUEL PRICEFUEL PRICESFUNCTIONAL FORMSFUTURE PRICESGASOLINEGASOLINE CONSUMPTIONGHGGHGSGLOBAL WARMINGGREEN ENERGYGREENHOUSEGREENHOUSE GASGREENHOUSE GAS EMISSIONSGREENHOUSE GASSESHEATHEATING SYSTEMSHOT WATERHYDROPOWERIMPORTSINCREASING RETURNSINCREASING RETURNS TO SCALEINTERNATIONAL TRADEINVESTMENT DECISIONSINVESTMENT OPPORTUNITIESIPCCKILOWATT HOURLOW TARIFFSLOW-CARBONMARGINAL ABATEMENTMARGINAL ABATEMENT COSTMARGINAL ABATEMENT COSTSMARGINAL COSTMARGINAL COSTSMARGINAL DAMAGE FUNCTIONMARKET ECONOMYMARKET FAILUREMARKET FAILURESMETHANENASH EQUILIBRIUMNATURAL GASNONRENEWABLE RESOURCENUCLEAR POWEROIL PRICESOLIGOPOLYOPPORTUNITY COSTORGANIC WASTEOSCILLATIONSPERFORMANCE STANDARDSPERMIT TRADINGPHOTOVOLTAICSPOLICY ADVICEPOLICY MAKERSPOLICY RELEVANCEPOLICY SCENARIOPOLLUTIONPOLLUTION CONTROLPOLLUTION TAXPORTFOLIOPOSITIVE EXTERNALITIESPOSITIVE EXTERNALITYPOWER PLANTSPPPREDATORY PRICINGPRICE INCREASESPRICE OF OILPRIVATE INFORMATIONPRIVATE MARGINAL COSTPRODUCER PRICEPRODUCERSPRODUCTION COSTSPROTECTIONISMPUBLIC GOODQUOTASREDUCING EMISSIONSREGULATORY CAPTURERENEWABLE ELECTRICITYRENEWABLE ENERGYRENEWABLE ENERGY POLICYRENEWABLE ENERGY SOURCESRENEWABLE ENERGY TECHNOLOGYRENEWABLE FUELSRENEWABLE PORTFOLIO STANDARDSRENEWABLE POWERRENEWABLE SOURCESRESOURCE ECONOMICSRETURNS TO SCALERURAL COMMUNITIESRURAL ELECTRIFICATIONSCENARIOSSOLAR INSTALLATIONSOLAR POWERSOLAR WATER HEATERSSOLAR WATER HEATINGSOLAR WATER HEATING SYSTEMSSPOT MARKETSTATISTICAL ANALYSISSUNK COSTSSUNLIGHTSUPPLY CURVESUPPLY SIDESUSTAINABLE DEVELOPMENTTAX CREDITTAX CREDITSTAX INCENTIVETAX INCENTIVESTOTAL COSTTRADE BALANCETRADE DISPUTESTRADING PARTNERSTRADITIONAL ECONOMIESTROUGHUNEMPLOYMENTWAGESWINDWIND CAPACITYWIND FARMSWIND POWERWIND PROJECTSWTOWorld Bank10.1596/1813-9450-6238