I just read a very nice article by Bob Litterman in CATO's "Regulation" on the finance of carbon taxes. It includes a review of some of the recent academic calculations. Like just about every economist, Bob favors a carbon tax or tradeable emissions right over the vast network of regulatory controls on which we are now embarked. I might add that getting rid of the large subsidies for carbon emissions implicit in many country's policies would help before we start taxing.
"In our model, the costs of a financial crisis come largely from resources lost in bankruptcy and liquidation," VV Chari said. "To the extent that capital requirements can reduce the debt level of firms, that reduces the losses from bankruptcy. And because it reduces the losses, it reduces the incentive of governments to bail out."
Dr. Richard Sandor, renowned financial innovator and entrepreneur, was named Chevalier dans l´ordre de la Légion d´Honneur (Knight in the French National Order of the Legion of Honor). The award is the highest decoration granted by the French government, and acknowledges his accomplishments in the field of environmental finance and carbon trading as well as his personal commitment and contribution to the promotion of French-American friendship. This award was conferred upon Dr. Sandor by decree of the President of France.
"The idea that the government has this unlimited ability to make such prior commitments is unrealistic and also has worked out badly when they tried," said V.V. Chari, Director of the Heller-Hurwicz Economics Institute. "To the extent that banks doubt the credibility of a no-bailout commitment, they have an incentive to take on lots of risk and then force the commitment to be broken."