We study the short-run welfare effects of reducing coal production in China. We find that the 2016 supply reduction policy led to an excessive and uneven quantity cut, resulting in a deadweight loss of 97.1 billion RMB. A Pigouvian tax internalizing the health costs of air pollution would reduce the quantity by 5.8% during the policy period.
We compare the performance of human and artificially intelligent (AI) decision makers in simple binary classification tasks where the optimal decision rule is given by Bayes Rule. We show that ChatGPT is also subject to biases that result in suboptimal decisions. However we document a rapid evolution in the performance of ChatGPT from sub-human performance for early versions (ChatGPT 3.5) to superhuman and nearly perfect Bayesian classifications in the latest versions (ChatGPT 4o).
The duration of renewable subsidies alters expectations about future competition for fossil fuel power plants, driving their entry and exit decisions. The government can leverage this to determine the optimal length of subsidies.
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Duis posuere tellus ac convallis placerat. Proin tincidunt magna sed ex sollicitudin condimentum.