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Reducing Indonesia’s deforestation‐based greenhouse gas emissions

Listed author(s):
  • Peter Warr
  • Arief Anshory Yusuf

Indonesia has set the target that by the year 2020 its emissions of greenhouse gases will be reduced by 26 per cent relative to business-as-usual conditions. This article analyses the effectiveness of a subsidy to the use of land in forestry as a means of achieving this goal. The analysis uses a general equilibrium model of the Indonesian economy characterised by explicit treatment of land use, disaggregated by industry and by region. The results of the analysis indicate that the subsidy cost of permanently reducing carbon emissions by 26 per cent is a little over US$1 per metric tonne of carbon emissions abated. This cost needs to be compared with that of alternative instruments and with the price of carbon that might be agreed under the proposed Reducing Emissions through Deforestation and Land Degradation (REDD) scheme, to be administered through the World Bank and the United Nations.

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Article provided by Australian Agricultural and Resource Economics Society in its journal Australian Journal of Agricultural and Resource Economics.

Volume (Year): 55 (2011)
Issue (Month): 3 (July)
Pages: 297-321

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Handle: RePEc:bla:ajarec:v:55:y:2011:i:3:p:297-321
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Web page: http://onlinelibrary.wiley.com/journal/10.1111/(ISSN)1467-8489
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  1. Peter Warr, 2005. "Food policy and poverty in Indonesia: a general equilibrium analysis ," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 49(4), pages 429-451, December.
  2. Lee, Huey-Lin & Hertel, Thomas & Rose, Steven & Avetisyan, Misak, 2008. "An Integrated Global Land Use Data Base for CGE Analysis of Climate Policy Options," GTAP Working Papers 2603, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
  3. Warr, Peter & Yusuf, Arief Anshory, 2011. "Reducing Indonesia’s deforestation-based greenhouse gas emissions," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 55(3), September.
  4. Arief Anshory Yusuf, 2008. "INDONESIA-E3: An Indonesian Applied General Equilibrium Model for Analyzing the Economy, Equity, and the Environment," Working Papers in Economics and Development Studies (WoPEDS) 200804, Department of Economics, Padjadjaran University, revised Sep 2008.
  5. George Fane & Peter Warr, 2008. "Agricultural Protection In Indonesia," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 44(1), pages 133-150.
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