Pardee Center Hosts Workshop on Carbon Taxes Convened by Faculty Research Fellow Jim Stodder

Jim Stodder, a Faculty Research Fellow at the Frederick S. Pardee Center for the Study of the Longer-Range Future and a Visiting Professor of the Practice at Metropolitan College, hosted an all-day workshop exploring carbon tax forecasting at the Pardee Center on February 8.

A carbon tax has long been viewed as a potentially viable solution to achieving dramatic reductions in greenhouse gas emissions, but determining the right price on carbon has been a major point of contention. Since the Paris Climate Agreement of 2015, a number of complex Integrated Assessment Models (IAMs) have been developed, resulting in wide variations in tax-level recommendations to keep global temperature from rising more than 2º Celsius.

The purpose of the workshop was to discuss Prof. Stodder’s draft paper exploring the use of Vector Auto Regressions (VARs) – a staple of macroeconomic forecasting but a little-used tool in the carbon tax debate – as a complement to the IAM framework to address this problem.

The workshop was attended by an interdisciplinary group of 15 people, comprised of Boston University faculty, staff, and graduate students, as well as climate change experts and economists from Beijing Normal University, McKinsey & Co., MIT, Pacific Northwest National Laboratory, and Synapse Energy Economics.

The workshop is part of Prof. Stodder’s work as a Pardee Center Faculty Research Fellow, where he is leading a project exploring new approaches to modeling carbon prices, and bringing together scholars working on economic and climate models to look at energy markets, macroeconomic stability, climate projections, and geopolitics. The first two years of the project is focused on publishing in academic journals, which will lay the groundwork for an international conference on carbon pricing in 2021.