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Tariff Reduction, Carbon Emissions and Poverty: An Economy-Wide Assessment for the Philippines

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Author Info

  • Erwin L. Corong

    ()
    (Economics Department, De La Salle University)

Abstract

This study investigates the potential impact of acarbon tax on the economy of the Philippines and on the livelihood of its people. It focuses on the interaction between such a tax and the country's ongoing trade liberalization programme. With energy use on the rise in the Philippines, increases in greenhouse gas emissions are almost inevitable. The policy most widely recommended by economists - a carbon tax - may be an efficient way to deal with the problem, but there is concern about its distributional effects. The study finds that a carbon tax would compensate for any tariff revenues lost through a reduction in trade tariffs. It also finds that the tax would reduce poverty and increase people's welfare. Imposing a carbon tax during the ongoing trade liberalization process - provided the carbon tax is used to reduce income taxes -is a sensible approach that could meet the country's economic, environmental and equity objectives.

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File URL: http://www.eepsea.net/pub/rr/11998463421ErwinRR08.pdf
File Function: First version, 2008
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Bibliographic Info

Paper provided by Economy and Environment Program for Southeast Asia (EEPSEA) in its series EEPSEA Research Report with number rr2008012.

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Date of creation: Jan 2008
Date of revision: Jan 2008
Handle: RePEc:eep:report:rr2008012

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Related research

Keywords: tariff; carbon emissions; poverty; Philippines;

References

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  1. Warwick J. McKibbin & Peter J. Wilcoxen, 2000. "Designing a Realistic Climate Change Policy that includes Developing Countries," Economics and Environment Network Working Papers 0003, Australian National University, Economics and Environment Network.
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Cited by:
  1. Dorothée Boccanfuso & Antonio Estache & Luc Savard, 2008. "Intra-Country Distributional Impact of Policies to Fight Climate Change: A Survey," Working Papers ECARES 2008_038, ULB -- Universite Libre de Bruxelles.
  2. Dorothee Boccanfuso & Antonio Estache & Luc Savard, 2011. "The Intra-country Distributional Impact of Policies to Fight Climate Change: A Survey," Journal of Development Studies, Taylor & Francis Journals, vol. 47(1), pages 97-117.
  3. Jan Imhof, 2012. "Fuel Exemptions, Revenue Recycling, Equity and Efficiency: Evaluating Post-Kyoto Policies for Switzerland," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 148(II), pages 197-227, June.
  4. Dorothée Boccanfuso & Antonio Estache & Luc Savard, 2008. "Distributional impact of global warming environmental policies: A survey," Cahiers de recherche 08-14, Departement d'Economique de la Faculte d'administration à l'Universite de Sherbrooke.

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