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A Computable General Equilibrium Assessment of a Developing Country Joining an Annex B Emission Permit Market

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  • Claudia Kemfert
  • Hans Kremers

Abstract

During the last years, the developing regions have come under increased pressure by the developed countries, in particular the USA, to join the international effort in global greenhouse gas abatement. On the one hand, the participation of the developing regions would offer the developed world with low cost opportunities for abatement. On the other hand,the economies of some developed regions such as China and India exhibit such fast growth that they are expected to be responsible for a significant part of future emissions during the next decade. The latter regions object to the imposition of emission targets on their economy as it would significantly hamper their economic growth. This paper focusses on the consequences of certain proposals to set emission targets for developing countries, here China. One of these proposals follows the USA by letting China accept its projected "Business-as-Usual" emission level for 2012 as its target. A proposal by the Center for Clean Air Policy takes more consideration for the viewpoint of the developing countries by imposing a so-called "growth-baseline" for China, where a target is set on its emission effciency.

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File URL: http://www.diw.de/documents/publikationen/73/diw_01.c.42660.de/dp454.pdf
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Paper provided by DIW Berlin, German Institute for Economic Research in its series Discussion Papers of DIW Berlin with number 454.

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Length: 22 p.
Date of creation: 2004
Date of revision:
Handle: RePEc:diw:diwwpp:dp454

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  1. Paul M. Bernstein & W. David Montgomery & Thomas F. Rutherford & Gui-Fang Yang, 1999. "Effects of Restrictions on International Permit Trading: The MS-MRT Model," The Energy Journal, International Association for Energy Economics, International Association for Energy Economics, vol. 0(Special I), pages 221-256.
  2. ZhongXiang Zhang, 2000. "The design and implementation of an international trading scheme for greenhouse gas emissions," Environment and Planning C: Government and Policy, Pion Ltd, London, Pion Ltd, London, vol. 18(3), pages 321-337, June.
  3. Robert J. Barro & Paul M. Romer, 1991. "Economic Growth," NBER Books, National Bureau of Economic Research, Inc, National Bureau of Economic Research, Inc, number barr91-1.
  4. Kemfert, Claudia & Zhang, ZhongXiang, 2003. "Linking developing country's cooperation on climate control with industrialized country's R&D and technology transfer," MPRA Paper 41473, University Library of Munich, Germany.
  5. Jensen, Jesper & Rasmussen, Tobias N., 2000. "Allocation of CO2 Emissions Permits: A General Equilibrium Analysis of Policy Instruments," Journal of Environmental Economics and Management, Elsevier, vol. 40(2), pages 111-136, September.
  6. Manne, Alan & Mendelsohn, Robert & Richels, Richard, 1995. "MERGE : A model for evaluating regional and global effects of GHG reduction policies," Energy Policy, Elsevier, Elsevier, vol. 23(1), pages 17-34, January.
  7. Bernstein, Paul M. & Montgomery, W. David & Rutherford, Thomas F., 1999. "Global impacts of the Kyoto agreement: results from the MS-MRT model," Resource and Energy Economics, Elsevier, Elsevier, vol. 21(3-4), pages 375-413, August.
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