Hans-Werner Sinn on the “green paradox”

The period of real [energy] price declines coincided with the emergence of the “green” movement and the re-orientation of the world energy policies by way of inducing direct demand restraints and introducing incentive systems to foster the development of “green” replacement technologies.  Thus, the threat of market destruction may indeed have increased the supply of fossil fuels enough to more than offset the growing world demand, thereby inducing real energy prices to fall, contrary to what a forward-looking explanation along the lines of Hotelling’s theory would have suggested prima facie.

That is from Sinn’s new book The Green Paradox: A Supply-Side Approach to Global Warming.


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