Energy markets, decarbonization goals, and international trade interact in important ways. Policy initiatives including carbon border adjustments, domestic content restrictions in the US Inflation Reduction Act, trade policy restrictions on solar panel components, export policies for liquefied natural gas, and hydrocarbon policies around the Russia-Ukraine war all exemplify these interactions. Better understanding of these interactions can improve economic analysis and energy, environmental, and trade policy.
The NBER, with the generous support of the Alfred P. Sloan Foundation, is launching a research project on energy markets, decarbonization, and trade. It will be directed by NBER Research Associates Natalia Ramondo (Boston University) and Joseph S. Shapiro (UC-Berkeley) and will convene a diverse range of researchers to study these inter-related issues. The project will involve a capstone research conference on March 20-21, 2025, in Cambridge, Massachusetts. A subsequent project, organized by Lint Barrage (ETH Zurich), will study energy markets and macroeconomic outcomes.
The NBER seeks papers by researchers from academia, government, and the corporate sector. Potential topics include, but are not limited to:
- How do trade policies for energy goods affect standard measures of social welfare and other potential policy objectives? What are their distributional effects?
- What are the economic and environmental impacts of carbon border adjustments/carbon tariffs and trade protection on solar, wind, and other types of renewable energy? What policy goals, including economic efficiency, inform their design?
- To what extent do actual or proposed policies involving trade or energy markets affect the pace of climate change? What are their distributional consequences?
- How do trade policies toward fossil fuels, renewable energy, and other energy goods affect overall economic activity, environment quality, and national (economic) security?
- What are the economics and political economy of enforcing carbon border adjustments, carbon tariffs, and other policies linking international economics and energy?
- To what extent do domestic energy policies affect U.S. trade and international economic interactions? Are trade policies for energy a form of hidden protectionism?
- How do foreign direct investment and multinational production, foreign loan guarantees, foreign investment policies, and other non-trade types of international market integration affect US energy markets?
- What are the patterns of comparative advantage in energy goods, including those needed for the transition to clean energy, and how do they affect the economy? What drives such patterns?
- How does trade in existing or emerging energy technologies affect the global economy?
- How does global trade in energy affect the pattern of trade surpluses and deficits across nations, and how may shifts in the mix of energy sources used in Europe and the US affect these patterns?
- How do sanctions on trade in energy products, particularly hydrocarbons, affect the United States and other nations that impose such sanctions and those that are the targets? Can they be enforced? How important are black markets?
The tools and approach of the research studies may be drawn from any field of applied and international microeconomics, including energy and environmental economics, international trade and investment, macroeconomics, financial economics, industrial organization, labor economics, and public finance. Both theoretical and empirical research papers are welcome. Submissions from researchers with and without NBER affiliations, from early career scholars and from researchers from under-represented groups are welcome. To be considered for inclusion on the program, upload papers by 11:59pm ET on October 16, 2024.
Decisions about which eight papers will be included on the program will be announced in November 2024. Please do not submit papers that will be published by March 2025. All proposals must be accompanied by a comprehensive conflict of interest statement that describes any financial or other interests of the researchers that might relate to the proposed work, and in particular that discloses any ties to the energy industry.
The NBER will pay an honorarium to authors and will cover the hotel and economy class travel cost for up to two authors per paper to attend the capstone conference, which will also include selected graduate students in the fields of energy/environmental and international economics. There will be a virtual pre-conference in December 2024 for authors to gather feedback about plans and ongoing work. Authors may be invited to submit post-conference revised papers to a special issue of a peer-reviewed field journal in energy or environmental economics, or may choose to submit individually elsewhere. Please direct questions about this project to confer@nber.org