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Impacts of the Québec carbon emissions trading scheme on plant-level performance and employment

Author

Listed:
  • Julien Hanoteau

    (KEDGE Business School [Marseille], AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique)

  • David Talbot

    (ENAP - École nationale d'administration publique (Québec, Province))

Abstract

In 2013, Québec implemented a greenhouse gas (GHG) emissions trading system (QC ETS), despite opposition from industry, which feared loss of competitiveness and warned about job destruction. This article assesses the impact of that carbon regulation on industrial facilities in Québec. Conditional difference-in-differences ordinary least squares regressions show that regulated plants reduced their GHG emissions by about 9.8%, employment by about 6.8% and carbon intensity by about 3.7% more compared to non-regulated plants in the rest of Canada during the period 2013–2015. This suggests that facilities adapted to the new program by improving their technology, but first and foremost by scaling down their activity, which raises questions about the ability of the QC ETS to induce enough environmental investment and innovation in industrial facilities. The results, in terms of employment effects, contrast with the findings of similar studies on the early stages of the European ETS and the British Columbia carbon tax scheme, and this information challenges the initial allocation scheme for permits, in particular, with a view to a green fiscal reform.

Suggested Citation

  • Julien Hanoteau & David Talbot, 2019. "Impacts of the Québec carbon emissions trading scheme on plant-level performance and employment," Post-Print hal-02151028, HAL.
    • Handle: RePEc:hal:journl:hal-02151028
    DOI: 10.1080/17583004.2019.1595154
    Note: View the original document on HAL open archive server: https://amu.hal.science/hal-02151028
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    Citations

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    Cited by:

    1. Felix Pretis, 2022. "Does a Carbon Tax Reduce CO2 Emissions? Evidence from British Columbia," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 83(1), pages 115-144, September.
    2. Jiansong Xu, 2024. "The Role of Carbon Pricing in Food Inflation: Evidence from Canadian Provinces," Papers 2404.09467, arXiv.org, revised Apr 2024.
    3. Wu, Rongxin & Tan, Zhizhou & Lin, Boqiang, 2023. "Does carbon emission trading scheme really improve the CO2 emission efficiency? Evidence from China's iron and steel industry," Energy, Elsevier, vol. 277(C).
    4. Shenhai Huang & Chao Du & Xian Jin & Daini Zhang & Shiyan Wen & Zhijie Jia, 2023. "The Impact of Carbon Emission Trading on Renewable Energy: A Comparative Analysis Based on the CGE Model," Sustainability, MDPI, vol. 15(16), pages 1-16, August.

    More about this item

    Keywords

    Environmental regulation; carbon market; employment; climate policy;
    All these keywords.

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