Download or read book How Large are the Impacts of Carbon Motivated Border Tax Adjustments written by Yan Dong and published by . This book was released on 2009 with total page 37 pages. Available in PDF, EPUB and Kindle. Book excerpt: "This paper discusses the size of impact of carbon motivated border tax adjustments on world trade. We report numerical simulation results which suggest that impacts on welfare, trade, and emissions will likely be small. This is because proposed measures use carbon emissions in the importing country in producing goods similar to imports rather than carbon content in calculating the size of barriers. Moreover, because border adjustments involve both tariffs and export rebates, it is the differences in emissions intensity across sector rather than emissions level which matters. Where there is no difference in emissions intensities across sectors, Lerner symmetry holds for the border adjustment and no relative effects occur. In our numerical simulation analyses border tax adjustments accompany carbon emission reduction commitments made either unilaterally, or as part of a global treaty and to be applied against non signatories. We use a four-region (US, EU, China, ROW) general equilibrium structure which captures energy trade and has endogenously determined energy supply so that global emissions can change with policy changes. We calibrate our model to 2006 data and analyze the potential impacts of both EU and US carbon pricing at various levels, either along with or without carbon motivated BTAs policies on welfare, emissions, trade flows and production. Results indicate only small impacts of these measures on global emissions, trade and welfare, but the signs of effects are as expected. BTAs alleviate leakage effects as expected. In trade impacts, compared with no BTAs, BTAs reduce imports of committing countries, and increase imports by other countries. EU and US BTAs against China reduce exports by China. With BTAs, the value of production in the country with carbon reduction measures are introduced increases, and other country's production decreases compared with the case of no BTAs. With the contraction of world trade flows caused by the financial crisis, carbon motivated BTAs offer a prospect of a compounding effect in a world which is going protectionist and decarbonized at the same time, but the added effects of BTAs seems small"--National Bureau of Economic Research web site.

Download or read book How Large are the Impacts of Carbon Motivated Border Tax Adjustments written by Yan Dong and published by . This book was released on 2014 with total page 37 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper discusses the size of impact of carbon motivated border tax adjustments on world trade. We report numerical simulation results which suggest that impacts on welfare, trade, and emissions will likely be small. This is because proposed measures use carbon emissions in the importing country in producing goods similar to imports rather than carbon content in calculating the size of barriers. Moreover, because border adjustments involve both tariffs and export rebates, it is the differences in emissions intensity across sector rather than emissions level which matters. Where there is no difference in emissions intensities across sectors, Lerner symmetry holds for the border adjustment and no relative effects occur. In our numerical simulation analyses border tax adjustments accompany carbon emission reduction commitments made either unilaterally , or as part of a global treaty and to be applied against non signatories. We use a four-region (US, EU, China, ROW) general equilibrium structure which captures energy trade and has endogenously determined energy supply so that global emissions can change with policy changes. We calibrate our model to 2006 data and analyze the potential impacts of both EU and US carbon pricing at various levels, either along with or without carbon motivated BTAs policies on welfare, emissions, trade flows and production. Results indicate only small impacts of these measures on global emissions, trade and welfare, but the signs of effects are as expected. BTAs alleviate leakage effects as expected. In trade impacts, compared with no BTAs, BTAs reduce imports of committing countries, and increase imports by other countries. EU and US BTAs against China reduce exports by China. With BTAs, the value of production in the country with carbon reduction measures are introduced increases, and other country's production decreases compared with the case of no BTAs. With the contraction of world trade flows caused by the financial crisis, carbon motivated BTAs offer a prospect of a compounding effect in a world which is going protectionist and decarbonized at the same time, but the added effects of BTAs seems small.

Download or read book Leveling Or Mining the Playing Field Implementation Problems of Carbon Motivated Border Adjustment Taxes written by Michael Friis Jensen and published by . This book was released on 2012 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Climate change policies and trade policy are on a collision course. Border tax adjustments are at the center of the debate and are being considered in many Organization for Economic Co-operation and Development (OECD) countries, notably the United States and the European Union (EU). They will tax carbon emissions at the border with the aim of leveling the playing field between countries with different carbon emission limits. Border tax adjustments may be justified theoretically, but the challenges of implementation and its associated costs and incentives are a key determinant of the outcome. Implementation depends on complex administrative arrangements and controversial calculations of the embedded carbon in imported goods. Border tax adjustment schemes might mine rather than level the playing field. Implementation problems invite vested interests to influence the policy process and divert border adjustment taxes towards protectionist uses. Decision makers and academics alike have produced little evidence on implementation problems but appear to discuss the very complex border tax adjustment scheme with the implicit assumption that implementation problems can be solved if the need arises. The implementation problems are linked to the difficulties of calculating embedded carbon. This paper discusses a key question: how accurately can we measure embedded carbon and what will the inherent uncertainty do to trade policy when it triggers political economy forces?

Download or read book On the Effectiveness of Carbon motivated Border Tax Adjustments written by John Whalley and published by . This book was released on 2009 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Carbon Pricing What Role for Border Carbon Adjustments written by Ian W.H. Parry and published by International Monetary Fund. This book was released on 2021-09-27 with total page 22 pages. Available in PDF, EPUB and Kindle. Book excerpt: This Climate Note discusses the rationale, design, and impacts of border carbon adjustments (BCAs), charges on embodied carbon in imports potentially matched by rebates for embodied carbon in exports. Large disparities in carbon pricing between countries is raising concerns about competitiveness and emissions leakage, and BCAs are a potentially effective instrument for addressing such concerns. Design details are critical, however. For example, limiting coverage of the BCA to energy-intensive, trade-exposed industries facilitates administration, and initially benchmarking BCAs on domestic emissions intensities would help ease the transition for emissions-intensive trading partners. It is also important to consider how to apply BCAs across countries with different approaches to emissions mitigation. BCAs are challenging because they pose legal risks and may be at odds with the differentiated responsibilities of developing countries. Furthermore, BCAs provide only modest incentives for other large emitting countries to scale carbon pricing—an international carbon price floor would be far more effective in this regard.

Download or read book Carbon Motivated Border Tax Adjustments written by Ben Lockwood and published by . This book was released on 2008 with total page 20 pages. Available in PDF, EPUB and Kindle. Book excerpt: We discuss emerging proposals for border tax adjustments (BTAs) to accompany commitments to reduce carbon emissions in the EU, the US and other OECD economies. The rationale offered for such border adjustment is that various entities, such as the EU, if making commitments to reduce emissions which go beyond those undertaken in other regions of the world, impose added costs on domestic producers which create a competitive disadvantage for them. Some form of remedy is viewed as reasonable to maintain the competitiveness of domestic industries when responding to global environmental problems. In this paper, we argue that despite its current carbon manifestation, the issue of border tax adjustments and both their rationale and their effects on trade are not new and, despite the present debate (which seems to overlook older literature), have arisen before. Earlier debate on border tax adjustments occurred at the time of the adoption of the Value Added Tax (VAT) in the EU as a tax harmonization target in the early 1960's. But academic literature of the time showed that a change between origin and destination basis in the VAT would be neutral and hence the use of a destination based tax in the EU to accompany the VAT offered no trade advantage to Europe. Here we argue that essentially the same arguments also apply for carbon motivated BTAs, and in the current debate there seems to be a misconception between price level effects and relative price effects stemming from a BTA, which needs correcting. We also argue that the impact of border tax adjustments should be viewed as independent of the motivation of the adjustments.

Download or read book Global Welfare Implications of Carbon Border Taxes written by Daniel Gros and published by CEPS. This book was released on 2009 with total page 19 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper presents a simple, basic model to compute the welfare consequences of the introduction of a tariff on the CO2 content of imported goods in a country that already imposes a domestic carbon tax. The main finding is that the introduction of a carbon import tariff increases global welfare (and not just the welfare of the importing country) if there is no (or insufficient) pricing of carbon abroad. A higher domestic price of carbon justifies a higher import tariff. Moreover, a higher relative intensity of carbon abroad increases the desirability of high import tariff imposed by the home country because a border tax shifts production to the importing country, which in this case leads to lower environmental costs.

Download or read book Long term Geopolitical Impacts of Carbon Border Tax Adjustments on Climate Change Mitigation written by Matthieu Beauchemin and published by . This book was released on 2009 with total page 72 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Unilateral Carbon Taxes Border Tax Adjustments and Carbon Leakage written by Joshua Elliott and published by . This book was released on 2012 with total page 43 pages. Available in PDF, EPUB and Kindle. Book excerpt: We examine the impact of a unilateral carbon tax in developed countries focusing on the expected size of carbon leakage (an increase in emissions in non-taxing regions as a result of the tax) and the effects on leakage of border tax adjustments. We start by analyzing the problem using a simple two-country, three-good general equilibrium model to develop intuitions. We then simulate the expected size of the effects using a new, open-source, computable general equilibrium (CGE) model. We analyze the extent of emissions reductions from a carbon tax in countries that made commitments under the Kyoto Protocol (Annex B countries), the expected carbon leakage, and the effects of border tax adjustments on carbon leakage, all relative to our baseline projections for emissions. We also perform extensive sensitivity tests on the parameters of the CGE model. Finally, we consider the effects of imperfect border tax adjustments on leakage, such as global or regional schedules of border taxes.

Download or read book Carbon Motivated Border Tax Adjustment written by Paola Rocchi and published by . This book was released on 2015 with total page 30 pages. Available in PDF, EPUB and Kindle. Book excerpt: The analysis focuses on carbon-motivated border tax adjustment (CBTA). CBTA are tariffs applied to imports designed to avoid drawbacks of emission reduction policies when only one or few regions (the abating regions) implement them. Through CBTA the abating regions level out different treatment applied to domestic and imported products. In this paper we focus on CBTA metric. Through a multi-region and multi-sector analysis we compute and compare two possible CBTA systems that the European Union could implement to complement a hypothetical carbon tax applied to domestic products. In one system, tariffs are computed based on the emissions generated abroad to produce the goods imported by the European Union. In the second system, tariffs are based on the emissions that the European Union would have generated to produce domestically the same products. Results at country and sector level contribute to better understand the effects of this instrument and to add information to the political debate on it. Moreover, an important contribution of this analysis is that we explore methodological issues that arise from the use of multi-region and multi-sector models to compute different CBTA metrics.

Download or read book The Poverty and Distributional Impacts of Carbon Pricing Channels and Policy Implications written by Baoping Shang and published by International Monetary Fund. This book was released on 2021-06-25 with total page 32 pages. Available in PDF, EPUB and Kindle. Book excerpt: Addressing the poverty and distributional impacts of carbon pricing reforms is critical for the success of ambitious actions in the fight against climate change. This paper uses a simple framework to systematically review the channels through which carbon pricing can potentially affect poverty and inequality. It finds that the channels differ in important ways along several dimensions. The paper also identifies several key gaps in the current literature and discusses some considerations on how policy designs could take into account the attributes of the channels in mitigating the impacts of carbon pricing reforms on households.

Download or read book Climate change related border tax adjustments written by and published by . This book was released on 2008 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: In the academic literature of the time, however, it was pointed out that the difference between an origin basis (taxes on domestic production, imports are tax free) and a destination basis (taxes rebated on exports, taxes apply to imports) is the same as that between a production tax and a consumption tax: both, in the broadly based case, are neutral and neither has direct effects on trade. [...] In a world in which taxes are broadly based on all commodities, the argument was that moving the VAT from an origin to a destination basis would simply change the price level (or the exchange rate); it would have no protective effect, and so the use of a destination-based tax would confer no trade advantage on Europe. [...] The United States, which had been pushing for a negotiation on BTAs as part of the then- emerging Tokyo Round in the GATT, accepted this analytical argument and Ben Lockwood is Professor of changed its policy approach, and there the issue of BTAs stood until its recent Economics at the University of Warwick, manifestation as a proposed accompaniment to carbon emissions control. [...] Lockwood is a Fellow of the Centre BTAs; also that the effects of a BTA should be viewed as independent of the motivation for Economic Policy Research, UK, and for the adjustment. [...] The fact that the current debate is driven by editorial boards of Finanzarchiv, carbon emissions reduction should be seen as largely irrelevant to an assessment of International Tax and Public Finance, the impacts of the BTAs themselves.

Download or read book RESEARCH ON THE IMPACT MECHANISM OF CARBON TARIFF AND CARBON LABELING ON AGRI TRADE AND EMISSIONS REDUCTION written by Chuanmin SHUAI and published by American Academic Press. This book was released on 2016-09-08 with total page 266 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book discusses on the Impact Mechanism of Carbon Tariffs and Carbon Labeling on Agri-trade and Emissions Reduction. Specifically, (1) it has analyzed the effect of carbon tariffs on Agri-trade and emissions reduction based on the hypothesis of carbon factor movement and the game theory, and built a Theoretical Model for carbon labeling to lead low-carbon behavior based on the international practices; (2) it simulated the impact of carbon tariffs on world's macro-economy and Agri-trade in China and worldwide using the Global Trade Analysis Project (GTAP) model; (3) it has made the first attempt to see the differences of willingness to pay for low-carbon products, purchasing behavior and expectations for government subsidies between consumers of different regions at different levels in China, by adopting questionnaire survey and scenario experiment; and (4) it has done an empirical analysis of carbon labels’ effect on low carbon consumption behavior based on Structural Equation Modeling (SEM) and experimental observation data with large samples. Finally, it has proposed policy recommendations based on the findings of the above theoretic and empirical studies.

Download or read book The Green Paradox written by Hans-Werner Sinn and published by MIT Press. This book was released on 2012-02-03 with total page 287 pages. Available in PDF, EPUB and Kindle. Book excerpt: A leading economist develops a supply-side approach to fighting climate change that encourages resource owners to leave more of their fossil carbon underground. The Earth is getting warmer. Yet, as Hans-Werner Sinn points out in this provocative book, the dominant policy approach—which aims to curb consumption of fossil energy—has been ineffective. Despite policy makers' efforts to promote alternative energy, impose emission controls on cars, and enforce tough energy-efficiency standards for buildings, the relentlessly rising curve of CO2 output does not show the slightest downward turn. Some proposed solutions are downright harmful: cultivating crops to make biofuels not only contributes to global warming but also uses resources that should be devoted to feeding the world's hungry. In The Green Paradox, Sinn proposes a new, more pragmatic approach based not on regulating the demand for fossil fuels but on controlling the supply. The owners of carbon resources, Sinn explains, are pre-empting future regulation by accelerating the production of fossil energy while they can. This is the “Green Paradox”: expected future reduction in carbon consumption has the effect of accelerating climate change. Sinn suggests a supply-side solution: inducing the owners of carbon resources to leave more of their wealth underground. He proposes the swift introduction of a “Super-Kyoto” system—gathering all consumer countries into a cartel by means of a worldwide, coordinated cap-and-trade system supported by the levying of source taxes on capital income—to spoil the resource owners' appetite for financial assets. Only if we can shift our focus from local demand to worldwide supply policies for reducing carbon emissions, Sinn argues, will we have a chance of staving off climate disaster.

Download or read book Sectoral Policies for Climate Change Mitigation in the EU written by International Monetary Fund and published by . This book was released on 2020-09-16 with total page 129 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper discusses sectoral policies needed to achieve the ambitious greenhouse gas (GHG) emissions reduction targets announced in the European Union's Green Deal, complementing the companion paper "EU Climate Mitigation Policy", which focuses on broader EU-level policies.

Download or read book Border Carbon Adjustments Rationale Design and Impact written by Thomas A. Wolf and published by International Monetary Fund. This book was released on 1992 with total page 42 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper assesses the rationale, design, and impacts of border carbon adjustments (BCAs). Large disparities in carbon pricing between countries raise concerns about competitiveness and emissions leakage. BCAs are potentially the most effective domestic instrument for addressing these challenges—but design details are critical. For example, limiting coverage of the BCA to energy-intensive, trade-exposed industries facilitates administration, and initially benchmarking BCAs on domestic emissions intensities would ease the transition for trading partners with emission-intensive production. It is also important to consider how to apply BCAs across countries with different approaches to emissions mitigation. BCAs alone do not solve the free-rider problem in carbon pricing, but might be a step to an effective international carbon price floor.

Download or read book Consumption Based Approaches in International Climate Policy written by Christian Lininger and published by Springer. This book was released on 2015-03-13 with total page 258 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book analyses the potentials and consequences of a change from production-based to consumption-based approaches in international climate policy. With the help of an analytical model, the author investigates the effects of different policy variants on environmental effectiveness, cost-effectiveness, carbon leakage, competitiveness and the global distribution of income. The economic, legal and political background and the often contradictory findings on consumption-based approaches are reviewed in great detail. In the final chapters, options for practical policy design are developed. The book concludes that a switch to consumption orientation is not a policy tool whereby industrialized countries can unilaterally improve climate policy effectiveness, but should rather be seen as a possible intermediate step on the way to a fully multilateral mitigation strategy.