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Economic impacts of EU clean air policies assessed in a CGE framework

Author

Listed:
  • Vrontisi, Zoi
  • Abrell, Jan
  • Neuwahl, Frederik
  • Saveyn, Bert
  • Wagner, Fabian

Abstract

This paper assesses the macroeconomic and sectoral impacts of the “Clean Air Policy Package” proposed by the European Commission in December 2013. The analysis incorporates both the expenditures necessary to implement the policy by 2030 and the resulting positive feedback effects on human health and crop production. A decomposition analysis identifies the important drivers of the macroeconomic impacts. We show that while expenditure on pollution abatement is a cost for the abating sectors, it also generates an increased demand for the sectors that produce the goods required for pollution abatement. Moreover, we find that positive feedback effects, particularly those related to health can offset the resource costs associated to the clean air policy and result in positive macroeconomic impacts for the economy of the European Union.

Suggested Citation

  • Vrontisi, Zoi & Abrell, Jan & Neuwahl, Frederik & Saveyn, Bert & Wagner, Fabian, 2016. "Economic impacts of EU clean air policies assessed in a CGE framework," Environmental Science & Policy, Elsevier, vol. 55(P1), pages 54-64.
  • Handle: RePEc:eee:enscpo:v:55:y:2016:i:p1:p:54-64
    DOI: 10.1016/j.envsci.2015.07.004
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    Citations

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    Cited by:

    1. Marco Rogna, 2020. "Microeconomic models of a production economy with environmental externalities," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 22(3), pages 2625-2650, March.
    2. Li, Na & Zhang, Xiaoling & Shi, Minjun & Hewings, Geoffrey J.D., 2019. "Does China's air pollution abatement policy matter? An assessment of the Beijing-Tianjin-Hebei region based on a multi-regional CGE model," Energy Policy, Elsevier, vol. 127(C), pages 213-227.
    3. Peter Rafaj & Markus Amann, 2018. "Decomposing Air Pollutant Emissions in Asia: Determinants and Projections," Energies, MDPI, vol. 11(5), pages 1-14, May.
    4. Nathalie Spittler & Ganna Gladkykh & Arnaud Diemer & Brynhildur Davidsdottir, 2019. "Understanding the Current Energy Paradigm and Energy System Models for More Sustainable Energy System Development," Post-Print hal-02127724, HAL.
    5. Lanzi, Elisa & Dellink, Rob & Chateau, Jean, 2018. "The sectoral and regional economic consequences of outdoor air pollution to 2060," Energy Economics, Elsevier, vol. 71(C), pages 89-113.
    6. Nathalie Spittler & Ganna Gladkykh & Arnaud Diemer & Brynhildur Davidsdottir, 2019. "Understanding the Current Energy Paradigm and Energy System Models for More Sustainable Energy System Development," Energies, MDPI, vol. 12(8), pages 1-22, April.
    7. François Chantret & Jean Chateau & Rob Dellink & Olivier Durand-Lasserve & Elisa Lanzi, 2020. "Can better technologies avoid all air pollution damages to the global economy?," Climatic Change, Springer, vol. 163(3), pages 1463-1480, December.
    8. Jean Chateau & Erwin Corong & Elisa Lanzi & Caitlyn Carrico & Jean Fouré & David Laborde, 2020. "Characterizing Supply-Side Drivers of Structural Change in the Construction of Economic Baseline Projections," Journal of Global Economic Analysis, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, vol. 5(1), pages 109-161, June.
    9. Zoi Vrontisi & Kostas Fragkiadakis & Maria Kannavou & Pantelis Capros, 2020. "Energy system transition and macroeconomic impacts of a European decarbonization action towards a below 2 °C climate stabilization," Climatic Change, Springer, vol. 162(4), pages 1857-1875, October.
    10. José M. Rueda-Cantuche & Tamas Revesz & Antonio F. Amores & Agustín Velázquez & Marian Mraz & Emanuele Ferrari & Alfredo J. Mainar-Causapé & Letizia Montinari & Bert Saveyn, 2020. "Improving the European input–output database for global trade analysis," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 9(1), pages 1-16, December.
    11. Xu, Bing & Lin, Weiran & Taqi, Syed Ali, 2020. "The impact of wind and non-wind factors on PM2.5 levels," Technological Forecasting and Social Change, Elsevier, vol. 154(C).
    12. Annicchiarico, Barbara & Battles, Susan & Di Dio, Fabio & Molina, Pierfrancesco & Zoppoli, Pietro, 2017. "GHG mitigation schemes and energy policies: A model-based assessment for the Italian economy," Economic Modelling, Elsevier, vol. 61(C), pages 495-509.
    13. Weitzel, Matthias & Saveyn, Bert & Vandyck, Toon, 2019. "Including bottom-up emission abatement technologies in a large-scale global economic model for policy assessments," Energy Economics, Elsevier, vol. 83(C), pages 254-263.
    14. Inha Oh & Wang-Jin Yoo & Yiseon Yoo, 2019. "Impact and Interactions of Policies for Mitigation of Air Pollutants and Greenhouse Gas Emissions in Korea," IJERPH, MDPI, vol. 16(7), pages 1-17, March.
    15. Jared C.Carbone & Yuzhou Shen, 2019. "Assessing the Benefits of Air-Quality Improvements in General Equilibrium: A Review," Working Papers 2019-05, Colorado School of Mines, Division of Economics and Business.

    More about this item

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects

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