Department of Finance
School of Business
Renmin University of China
P.R. China, 100872
Institutional Affiliation: Renmin University of China
NBER Working Papers and Publications
|February 2017||The Impact of Climate Change Skepticism on Adaptation in a Market Economy|
with Matthew E. Kahn: w23155
Climate change will increase the risk of temperature extremes. Induced innovation could offset some of this threat. This paper explores the demand and supply for climate adaptation innovation in a market economy. Climate change induces this innovation because the rising temperatures increase demand for self protection products and for profit firms respond to these incentives. We then augment the model to introduce climate skeptics. Such skeptics reject the claim that the world is warming and thus do not increasingly demand adaptation products. We study how the economy's rate of adaptation innovation, cross city migration, real estate pricing and the welfare of agents with rational expectations are all affected by the presence of such skeptics.
Published: Matthew E. Kahn & Daxuan Zhao, 2018. "The impact of climate change skepticism on adaptation in a market economy," Research in Economics, vol 72(2), pages 251-262. citation courtesy of
|November 2013||Pollution Control Effort at China's River Borders: When Does Free Riding Cease?|
with Matthew E. Kahn, Pei Li: w19620
At political boundaries, local leaders often have weak incentives to reduce polluting activity because the social costs are borne by downstream neighbors. This paper exploits a natural experiment set in China in which the central government changed the local political promotion criteria and hence incentivized local officials to reduce border pollution along specific criteria. Using a difference in difference approach, we document evidence of pollution progress with respect to targeted criteria at river boundaries. Other indicators of water quality, not targeted by the central government, do not improve after the regime shift. Using data on the economic geography of key industrial water polluters, we explore possible mechanisms.
Published: Water Pollution Progress at Borders: The Role of Changes in China's Political Promotion Incentives Matthew E. Kahn Pei Li Daxuan Zhao AMERICAN ECONOMIC JOURNAL: ECONOMIC POLICY VOL. 7, NO. 4, NOVEMBER 2015 (pp. 223-42