Conference Agenda
Overview and details of the sessions of this conference. Please select a date or location to show only sessions at that day or location. Please select a single session for detailed view (with abstracts and downloads if available).
Please note that all times are shown in the time zone of the conference. The current conference time is: 24th Aug 2026, 01:48:42am WEST
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Daily Overview |
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Climate Policy 4 Location: B127 Session Chair: David Comerford, University of Strathclyde | |
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The Macroeconomic Effects of EU ETS Regime Switching: Lessons from the Market Stability Reserve and Implications for ETS2 University of Potsdam, Germany This paper analyzes the macroeconomic consequences of the structural change in the European Union Emissions Trading System (EU ETS) around 2019, when prices shifted from a low, ineffective regime to a high, credible regime. We utilize a customized DSGE model with occasionally binding constraints for the German economy to examine the effects of this transition. We quantify the effects of the Market Stability Reserve (MSR) implementation on output, inflation, consumption, and investment. Our findings show that the MSR reduces carbon price volatility in response to macroeconomic shocks and thereby also dampens aggregate dynamics compared to a fixed cap-and-trade system. This differences have potential welfare implications and offer critical insights for the successful implementation of the upcoming EU ETS II. | |