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A European carbon border tax- much pain, little gain

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  • Ben McWilliams
  • Georg Zachmann

Abstract

The European Green Deal has set a target of reducing European Union carbon emissions by about 40 per cent over the next ten years. Reaching this target is likely to involve a significant increase in carbon prices. Theoretically, higher carbon prices can lead to carbon leakage, or the relocation of industrial activity and its accompanying emissions out of economies with high carbon prices and into economies with low carbon prices....

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  • Ben McWilliams & Georg Zachmann, 2020. "A European carbon border tax- much pain, little gain," Policy Contributions 35218, Bruegel.
    • Handle: RePEc:bre:polcon:35218
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    File URL: https://www.bruegel.org/wp-content/uploads/2020/03/PC-05-2020-050320v2.pdf
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    Cited by:

    1. Michael A. Mehling, 2023. "Supply-side offset crediting to manage climate policy spillover effects," Working Papers EPRG2313, Energy Policy Research Group, Cambridge Judge Business School, University of Cambridge.
    2. Robert J. R. Elliott & Ingmar Schumacher & Cees Withagen, 2020. "Suggestions for a Covid-19 Post-Pandemic Research Agenda in Environmental Economics," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 76(4), pages 1187-1213, August.
    3. Hafele, Jakob & Kuhls, Sonia, 2022. "Trade-off or tension: Can carbon be priced without risking economic competitiveness?," ZOE Discussion Papers 9, ZOE. institute for future-fit economies, Bonn.
    4. George Mörsdorf, 2021. "A Simple Fix for Carbon Leakage? Assessing the Environmental Effectiveness of the EU Carbon Border Adjustment," ifo Working Paper Series 350, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    5. Sergei S. Sudakov & Samvel S. Lazaryan & Anton I. Votinov, 2022. "EU’s Carbon Border Adjustment Mechanism: Assessment of Future Payments for Exporters," Finansovyj žhurnal — Financial Journal, Financial Research Institute, Moscow 125375, Russia, issue 5, pages 71-88, October.
    6. Robert B. Koopman & Mary Lisa Madell, 2023. "A fairer and more resilient multilateral trading system will require a reinvigorated WTO," Global Policy, London School of Economics and Political Science, vol. 14(S2), pages 35-39, March.
    7. Elisabeth Christen & Bettina Meinhart & Franz Sinabell & Gerhard Streicher, 2021. "Transportkostenwahrheit im internationalen Handel," WIFO Studies, WIFO, number 67045, April.
    8. Garnadt, Niklas & Grimm, Veronika & Reuter, Wolf Heinrich, 2020. "Carbon adjustment mechanisms: Empirics, design and caveats," Working Papers 11/2020, German Council of Economic Experts / Sachverständigenrat zur Begutachtung der gesamtwirtschaftlichen Entwicklung.
    9. Mehling, M. A., 2023. "Supply-Side Crediting to Manage Climate Policy Spillover Effects," Cambridge Working Papers in Economics 2345, Faculty of Economics, University of Cambridge.
    10. Strand,Jon, 2021. "Incentivizing Carbon Taxation in Low-Income Countries : Tax Rebating versus Carbon Crediting," Policy Research Working Paper Series 9698, The World Bank.
    11. Pavel Tcvetkov, 2021. "Climate Policy Imbalance in the Energy Sector: Time to Focus on the Value of CO 2 Utilization," Energies, MDPI, vol. 14(2), pages 1-22, January.
    12. Elkerbout, Milan & Bryhn, Julie & Righetti, Edoardo & Chapman, Francesca, 2022. "From carbon pricing to climate clubs: How to support global climate policy coordination towards climate neutrality," CEPS Papers 35998, Centre for European Policy Studies.
    13. Claudia Kettner & Gerald Feichtinger, 2021. "Fit for 55? Das neue Klima- und Energiepaket der EU," WIFO Monatsberichte (monthly reports), WIFO, vol. 94(9), pages 665-677, September.
    14. Ernst, Anne & Hinterlang, Natascha & Mahle, Alexander & Stähler, Nikolai, 2022. "Carbon pricing, border adjustment and climate clubs: An assessment with EMuSe," Discussion Papers 25/2022, Deutsche Bundesbank.
    15. McAusland, Carol, 2021. "Carbon taxes and footprint leakage: Spoilsport effects," Journal of Public Economics, Elsevier, vol. 204(C).
    16. Elkhan Richard Sadik-Zada & Mattia Ferrari, 2020. "Environmental Policy Stringency, Technical Progress and Pollution Haven Hypothesis," Sustainability, MDPI, vol. 12(9), pages 1-20, May.
    17. Mörsdorf, George, 2022. "A simple fix for carbon leakage? Assessing the environmental effectiveness of the EU carbon border adjustment," Energy Policy, Elsevier, vol. 161(C).
    18. Panagiotis Fragkos & Kostas Fragkiadakis & Leonidas Paroussos, 2021. "Reducing the Decarbonisation Cost Burden for EU Energy-Intensive Industries," Energies, MDPI, vol. 14(1), pages 1-23, January.
    19. Steinhauser Dušan & Kittová Zuzana & Khúlová Lucia, 2024. "Relationship Between CO2 Emissions and Trade: The Case of the EU," Intereconomics: Review of European Economic Policy, Sciendo, vol. 59(1), pages 41-47, February.
    20. Wifo, 2021. "WIFO-Monatsberichte, Heft 9/2021," WIFO Monatsberichte (monthly reports), WIFO, vol. 94(9), September.
    21. Niko Korpar & Mario Larch & Roman Stöllinger, 2022. "Comparing Scenarios for a European Carbon Border Adjustment Mechanism: Trade, FDI and Welfare Effects with a Focus on the Austrian Economy," wiiw Research Reports 460, The Vienna Institute for International Economic Studies, wiiw.

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