POEM - Policy Options to engage Emerging Asian economies in a Post-Kyoto regime

The methodology of the project is based on the development and assessment of policy options, including combinations of international and national policies, and institutional frameworks for international cooperation under a post-2012 regime. A number of different computational models is the primary tool that will be used by the POEM project partners, the IfW contributes with the DART model. The project is based on the application of an integrated modeling framework, and the study will use this integrated modeling framework in order to explore possible multiple pathways contributing to climate action without compromising development priorities.

ACCEPT – What determines people’s willingness to accept new climate change mitigation options?

Combating climate change poses a major challenge to governments, industry and society. Since international negotiations on emission reduction agreements have had limited success so far, governments have started considering, among other things, new options that may help mitigating climate change. Carbon dioxide capture and storage (CCS) and climate engineering (CE) are such options. Before testing or implementing any of these instruments, costs and benefits as well as the associated risks need to be evaluated. However, even if some options were found suitable, another crucial element for actual implementation would be public acceptance and people’s willingness to accept (WTA) these measures. People’s assessment and therefore their WTA any or all of these new climate change mitigation options is crucially influenced by their beliefs and emotions, by their risk perception and trust in institutions as well as by their risk aversion and ambiguity aversion.

The project intends to broaden the scientific knowledge of the issue by obtaining comprehensive empirical evidence on the determinants of people’s WTA and to close an existing research gap focusing on Germany. Such information is essential for designing an optimal portfolio of mitigation options. The research is funded by the German Ministry for Education and Research (BMBF).

CLIMA-U - Climate change mitigation and adaptation under uncertainty

The project CLIMA-U investigates the impact of multiple uncertainties on the policy choice of climate change mitigation and adaptation. With a significant component of numerical analysis, the project aims to provide quantitative benchmarks for the policy planning to address the dual challenge of uncertain climate change and economic growth of development countries.

CORE - Cooperative Regimes for Future Climate Policy

Attempts to implement 2°C-target-compatible emission reductions via international cooperation have not been very successful so far, as evidenced by the Kyoto Protocol and the negotiations on a post-Kyoto agreement. The CORE project analyses whether global cooperation is possible under the current setting of international negotiations on climate change, i.e. if it is possible to design a climate regime where long-term climate targets may be met and all countries agree on the distribution of reduction efforts. This is done using cooperative game theory in combination with a computable general equilibrium model, taking into account the uncertainty about key mitigation technologies. The theoretical model is supplemented by a field experiment with actual stakeholders in the climate negotiations and a controlled laboratory experiment.

The project is carried out jointly with the Fraunhofer Institute for Systems and Innovation Research ISI and the Karlsruhe Institute of Technology.

Desert Power Industrial Initiative – Modeling sectoral and regional impacts of renewable electricity production in the MENA region

The project aims to assess sectoral and regional macroeconomic impacts of solar and wind energy production in the EU, Middle East and North Africa (EUMENA) until 2050. It is commissioned by the Desert Power Industrial Initiative (Dii) that enables an industrial scale market for renewable energy in MENA by formulating a long-term vision, designing a regulatory framework and translating it into concrete reference projects.

The Dii’s strategic framework of an EUMENA integrated power system shows that in an interconnected power system the overall power system costs are lower than in two isolated regional power systems. This is essentially due to the vast solar and wind potentials in MENA and the complementary supply and demand structures in the south and the north of the Mediterranean Sea in all seasons.

More information is available here.

EXPECT: An experimental study of climate policy negotiations - Implications for policy design and impact assessment

Aim of the project is to combine methods of experimental economics with applied general equilibrium modeling in order to analyze how decision makers behave in prisoner dilemma situations adapted to contain elements of collective risk such as in climate change. We are interested in the determinants of cooperation which are important for climate negotiations.

In this project we adapt a public good game to inherit some characteristics of climate change. If the group as a whole is able to reach a given threshold, dangerous climate change is avoided – if the target is not met, participants risk losing a part of their assets with a given probability. In the series of experiments, we vary certain parameters to see how cooperation is changed. Most importantly, we introduce asymmetries which clearly play a role in the current climate negotiations. In the course of the experiments we also want to test whether students behave differently than more experienced decision makers, hence we run experiments both at the lab at the University of Kiel and at the Global Economic Symposium.

Completed Projects