Thread by @FelixPretis

How to reduce CO2 emissions effectively? We have a new paper in @NatureEnergyJnl detecting a-priori unknown policy interventions using machine learning. We find 10 policies in EU countries that reduced emissions 8-26%. @MoritzPSchwarz
#Econtwitter nature.com/articles/s4156…

Rather than asking if a particular policy works, we look at reverse-causal question – can we find emission reductions and attribute them to policies? We detect changes in emissions as structural breaks in two-way fixed effects panels as a-priori unknown treatment effects.

What we find: over 31 European countries and 345 potential opportunities for change we found 10 large policy interventions reducing emissions. These mainly involved carbon pricing and reduced emissions 8% to 26%.

More generally, our methods can be used to detect a-priori unknown treatment assignment and timing - as in earlier work on the BC carbon tax (link.springer.com/article/10.100…) and in our working paper on detecting treatment as structural breaks (papers.ssrn.com/sol3/papers.cf…).

Methods are openly available using R-package getspanel: github.com/moritzpschwarz… @MoritzPSchwarz