Carbon leakage revisited: unilateral climate policy with directed technical change

Using a stylized theoretical model, we argue that current economic analyses of climate policy tend to over-estimate the degree of carbon leakage, as they abstract from the effects of induced technological change. We analyse carbon leakage in a two-country model with directed technical change, where only one of the countries enforces an exogenous cap on emissions. Climate policy induces changes in relative prices, that cause carbon leakage through a terms-of-trade effect. However, these changes in relative prices also affect the incentives to innovate in different sectors. This leads to a counterbalancing induced-technology effect, which always reduces carbon leakage. We therefore conclude that the leakage rates reported in the literature may be too high, as these estimates neglect the effect of price changes on the incentives to innovate.

Putting a Price on Prisoner Release: The History of Bail and the Future of Parole

In this article, we argue that the history of bail foretells the future of parole. Under a plancalled the Conditional Post-Conviction Release Bond Act (recently passed into law inthree states), US prisoners can secure early release only after posting ‘post-convictionbail’. As with pre-trial bail, the fledgling model would require prisoners to pay a percent-age of the bail amount to secure their release under the contractual responsibility of acommercial bail agency. If release conditions are breached, bounty hunters are legallyempowered to seize and return the parolee to prison. Our inquiry outlines the origins of this post-conviction bond plan and the research upon which it is based. Drawing on the‘new penology’ framework, we identify several underlying factors that make for a ripeadvocacy environment and set the stage for widespread state-level adoption of this planin the near future. Post-conviction bail fits squarely within the growing policy trendstoward privatization, managerialism, and actuarial justice. Most importantly, though,advocates have the benefit of precedent on their side, as most US states have longrelied on a system of commercial bail bonding and private bounty hunting to manageconditional pretrial release.