IDEAS home Printed from https://ideas.repec.org/a/eee/jpolmo/v15y1993i5-6p473-490.html
   My bibliography  Save this article

How large are the incentives to join subglobal carbon-reduction initiatives?

Author

Listed:
  • Piggott, John
  • Whalley, John
  • Wigle, Randall

Abstract

This paper attempts to shed some light on what the incentives are for international participation in 'sub-global' carbon reduction initiatives. We use a six-region global general equilibrium trade and carbon emission model recently used by Whalley and Wigle to analyze the international incidence effects of various global carbon tax schemes. Here we modify this model so as to also capture the benefit side of reduced global warming by including emission reduction in the specification of preferences in each region. This change in model structure allows us to examine the strength of the incentives for sub-global arrangements to form with the aim of achieving reduced carbon emissions. Because there are no reliable estimates of the benefits from slowed global warming, we have adopted a procedure of evaluating incentives for any sub-global arrangements to be used relative to a reference point: 50 percent global emission reduction target, as in the 1988 Toronto call, is assumed to represent a full-participation global optimum, in which the sum of marginal country benefits from further global abatement exactly balance marginal country costs from further reductions in sue of carbon-based energy. A number of interesting points emerge from our calculations. Incentives for the larger regions to engage in unilateral emission reductions (including the U.S. which accounts for nearly 25 percent of global emissions) are surprisingly strong (more than half the assumed optimal 50% global reduction). The optimal reduction increases further when pairs of regions who each provide emission reduction benefits to the other are considered (more than 35 percent for North America and Europe). Also, terms-of-trade effects from such cuts help energy importers and amplify (in some cases substantially) the benefits to them of reduced emissions from slowed global warming. But both production and consumption-based cuts create spillover effects stimulating production or consumption in other regions, s
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Piggott, John & Whalley, John & Wigle, Randall, 1993. "How large are the incentives to join subglobal carbon-reduction initiatives?," Journal of Policy Modeling, Elsevier, vol. 15(5-6), pages 473-490.
  • Handle: RePEc:eee:jpolmo:v:15:y:1993:i:5-6:p:473-490
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/0161-8938(93)90002-8
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Welsch, Heinz, 1995. "Incentives for forty-five countries to join various forms of carbon reduction agreements," Resource and Energy Economics, Elsevier, vol. 17(3), pages 213-237, November.
    2. Mustafa Babiker, 1998. "The CO2 Abatement Game: Costs, Incentives and the Stability of a Sub-Global Coalition," Computational Economics 9807002, EconWPA.
    3. John Whalley, 1996. "Trade and Environment Beyond Singapore," NBER Working Papers 5768, National Bureau of Economic Research, Inc.
    4. Yan Dong & John Whalley, 2010. "Carbon, Trade Policy and Carbon Free Trade Areas," The World Economy, Wiley Blackwell, vol. 33(9), pages 1073-1094, September.
    5. Babiker, Mustafa H., 2001. "The CO2 abatement game: Costs, incentives, and the enforceability of a sub-global coalition," Journal of Economic Dynamics and Control, Elsevier, vol. 25(1-2), pages 1-34, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jpolmo:v:15:y:1993:i:5-6:p:473-490. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu). General contact details of provider: http://www.elsevier.com/locate/inca/505735 .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.