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Costs of Climate Policy when Pollution Affects Health and Labour Productivity. A general Equilibrium Analysis Applied to Sweden

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Author Info
Östblom, Göran () (National Institute of Economic Research)
Samakovlis, Eva () (National Institute of Economic Research)
Abstract

Much of the debate over global climate change involves estimates of the direct costs of global climate change mitigation. Recently this debate has included the issue of

ancillary benefits. These benefits consist mainly of health improvements. Although it is

generally acknowledged that air pollution affects respiratory health, and that valuations

of these impacts make up a significant proportion of the damage costs of air pollution,

these impacts are often neglected when evaluating the costs of climate policy. Since

reducing greenhouse gases has the effect of also reducing other pollutants affecting

human health and labour productivity these effects should be taken into consideration.

The analysis incorporates a linkage between air pollution and health effects into a

general equilibrium model for Sweden through a theoretical consistent framework.

Results from recent Swedish concentration-response and contingent valuation studies

are used to model direct disutility and indirect health effects that negatively affects the

productivity of labour. The costs of feedback effects on health and productivity are

compared in three different scenarios for attaining the Swedish carbon dioxide target

with alternative projected emission levels in the baseline scenario as well as alternative

harmful emission levels. Results show that not including feedback effects could mean

overstating the costs of climate policy. The magnitude of these effects are, however,

very sensitive to projected emission levels and to the judgement of harmful emission

levels.

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Publisher Info
Paper provided by National Institute of Economic Research in its series Working Paper with number 93.

Download reference. The following formats are available: HTML, plain text, BibTeX, RIS (EndNote), ReDIF
Length: 24 pages
Date of creation: 28 Dec 2004
Date of revision:
Handle: RePEc:hhs:nierwp:0093

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Related research
Keywords: air pollution ancillary benefits climate policy general equilibrium health

Other versions of this item:

Find related papers by JEL classification:
D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
I10 - Health, Education, and Welfare - - Health - - - General
Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Costs; Distributional Effects; Employment Effects
Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Nilsson, Charlotta & Huhtala, Anni, 2000. "Is CO2 Trading Always Beneficial? A CGE-Model Analysis on Secondary Environmental Benefits," Working Paper 75, National Institute of Economic Research. [Downloadable!]
  2. Huhtala, Anni & Samakovlis, Eva, 2003. "Green Accounting, Air Pollution and Health," Working Paper 82, National Institute of Economic Research.
  3. Burtraw, Dallas & Krupnick, Alan & Palmer, Karen & Paul, Anthony & Toman, Michael & Bloyd, Cary, 2003. "Ancillary benefits of reduced air pollution in the US from moderate greenhouse gas mitigation policies in the electricity sector," Journal of Environmental Economics and Management, Elsevier, vol. 45(3), pages 650-673, May. [Downloadable!] (restricted)
  4. Williams, Roberton III, 2002. "Environmental Tax Interactions when Pollution Affects Health or Productivity," Journal of Environmental Economics and Management, Elsevier, vol. 44(2), pages 261-270, September. [Downloadable!] (restricted)
    Other versions:
  5. Robert Ayres & Jörg Walter, 1991. "The greenhouse effect: Damages, costs and abatement," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 1(3), pages 237-270, September. [Downloadable!] (restricted)
  6. Weitzman, Martin L, 1976. "On the Welfare Significance of National Product in a Dynamic Economy," The Quarterly Journal of Economics, MIT Press, vol. 90(1), pages 156-62, February. [Downloadable!] (restricted)
    Other versions:
  7. Bruvoll, Annegrete & Glomsrod, Solveig & Vennemo, Haakon, 1999. "Environmental drag: evidence from Norway," Ecological Economics, Elsevier, vol. 30(2), pages 235-249, August. [Downloadable!] (restricted)
  8. Samakovlis, Eva & Huhtala, Anni & Bellander, Tom & Svartengren, Magnus, 2004. "Air Quality and Morbidity: Concentration-response Relationships for Sweden," Working Paper 87, National Institute of Economic Research.
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