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Trade Effects and Emissions Leakage Associated with Carbon Pricing Policies

Author

Listed:
  • Adkins, Liwayway
  • Garbaccio, Richard
  • Ho, Mun
  • Moore, Eric
  • Morgenstern, Richard

Abstract

In a previous work, we examined how the effects of a $15/ton CO2 price on U.S. industries change over four time horizons – the very short-, short-, medium-, and long-runs – as firms and consumers gradually adjust to new prices. We showed that the effects also depend on the number of countries implementing the policy as well as the use of offsetting policies, such as output-based rebates, to compensate losers. In the current extension of that work, we explore in greater depth competitiveness and emissions leakage issues – changes in trade flows and changes in emissions in countries without a carbon policy. Using a global CGE model based on GTAP 7 data, we focus on the long run effects of a multilateral carbon pricing policy, with and without output-based rebates applied to U.S. industries.

Suggested Citation

  • Adkins, Liwayway & Garbaccio, Richard & Ho, Mun & Moore, Eric & Morgenstern, Richard, 2011. "Trade Effects and Emissions Leakage Associated with Carbon Pricing Policies," Conference papers 332048, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:332048
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    File URL: https://ageconsearch.umn.edu/record/332048/files/5539.pdf
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