Daily Paper Digest

The climate crisis is an urgent, human-driven systemic challenge whose impacts are unfolding through increasingly frequent and severe extreme events. Although the 2015 Paris Agreement advanced global climate governance, implementation remains insufficient to limit warming to well below 2 °C and pursue 1.5 °C. Accelerating risks, interacting crises and potential tipping points suggest that climate change could become unmanageable if current GHGs emissions trajectories persist. This paper makes three contributions. First, it examines why we are failing to act decisively, highlighting a persistent awareness gap, competing priorities and weak political incentives for ambitious climate action. Second, it draws on NGFS climate-policy scenarios, the climate policy trilemma and a precautionary approach to clarify policymaking trade-offs under uncertainty. Third, it reviews policy, financial and technological levers to accelerate a just green transition. A new climate policy paradigm is needed: a systemic, precautionary, adaptive and incentive-compatible framework that can “tilt the odds” away from irreversible climate damage, even when probabilities are poorly known.

This paper studies a multi-product monopolist facing a privately informed consumer with additive and type-increasing valuations. Separate monopoly pricing is robustly optimal with respect to the type distribution if and only if the marginal rate of substitution between each pair of goods is monotone. This result is obtained by extending the conventional Myersonian approach.

Governments increasingly look to capital income for both revenue and redistribution. This column compares two dividend tax reforms in Israel – a permanent rate increase and a temporary one-year cut – to examine how high-income taxpayers can adjust the timing and labelling of dividends in ways that undermine reform. Both produced immediate surges of more than 100% in reported dividends and tax revenue. But only the temporary reform left a lasting mark: payouts fell sharply once the relief expired, as firms retained earnings in anticipation of future cuts. Because undistributed profits are not recorded as personal income, the resulting rise in retained earnings also made top-income inequality appear to fall.

Europe is converging on a definition of economic security as reduced dependence – de-risking, reshoring, buying European. This column argues that the definition is mistaken. Three decades of evidence on financial and production networks shows that resilience is a property of a node’s position in the network – the depth, diversity, and quality of its connections – not of the number of connections it has severed for self-sufficiency. Applying this test to critical input supply chains such as energy and defence – with Turkey, the EU’s largest customs union partner, as the defining case – the author argues that Europe passes the initiative’s ‘Singapore test’ only if it treats integration depth, rather than self-sufficiency, as the union’s security variable.

Governments increasingly look to capital income for both revenue and redistribution. This column compares two dividend tax reforms in Israel – a permanent rate increase and a temporary one-year cut – to examine how high-income taxpayers can adjust the timing and labelling of dividends in ways that undermine reform. Both produced immediate surges of more than 100% in reported dividends and tax revenue. But only the temporary reform left a lasting mark: payouts fell sharply once the relief expired, as firms retained earnings in anticipation of future cuts. Because undistributed profits are not recorded as personal income, the resulting rise in retained earnings also made top-income inequality appear to fall.

Poverty is not a static condition but a dynamic process. Yet the at-risk-of-poverty rate, which underpins EU poverty monitoring, captures who is poor in a given year but says nothing about how long people have been poor. This column introduces complementary measures to assess dynamic poverty in the EU, which suggest that poverty is more widespread and persistent than annual rates alone suggest and experiences vary sharply across countries. Social protection systems differ markedly in their ability to reduce long-duration poverty. These findings have direct relevance for the EU’s newly adopted Anti-Poverty Strategy.