- Countries decide whether they want to join the GRS. A country can join the GRS if it accepts the rules and levies a minimal carbon emission tax. Industrial countries pay an initial fee.
- In each period, every country belonging to the GRS independently determines its level of taxes on CO2 emissions. Emission taxes are the sole policy instrument a country is allowed to adopt. All tax revenues are collected in a global fund.
- In each period, the GRS refunds a share of the accumulated wealth to the participating countries. Each participating country receives an annual refund in proportion to the share of total CO2 emission reductions it achieves in the period under consideration.
- Non-refunded wealth of the GRS is invested in order to maintain funds for future refunding activities.
- In each period a country is allowed to exit. If a country leaves the GRS, it loses its right to refund.
- Decisions within the GRS are governed by majority rule.
February 24, 2008
Climate Change and Redistribution
A fascinating proposal for creating a global climate change policy: