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The carbon content of trade: Under border tariff adjustments and a global carbon regime

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  • Weitzel, Matthias
  • Peterson, Sonja

Abstract

In this paper we use a multi-regional, multi-sectoral CGE model of the world economy to assess the leakage effects and the changes of the carbon content of trade under different climate policy scenarios, including unilateral policies with and without border tariff adjustment (BTA) as well as stylized international policy scenarios. The paper combines input output techniques to assess the carbon content of trade over the whole production with CGE analysis to explore the impact of the different climate policies scenarios. The main results include that BTA does reduce the negative competitiveness effects of unilateral climate policy, but has only a modest effect on carbon leakage and hardly affects global carbon emissions. At the same time it is not a sufficient thread for many countries to rather join an international climate regime based on the contraction and convergence allocation of permits.

Suggested Citation

  • Weitzel, Matthias & Peterson, Sonja, 2011. "The carbon content of trade: Under border tariff adjustments and a global carbon regime," Conference papers 332076, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:332076
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    References listed on IDEAS

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    1. Saman Kelegama & Indra Nath Mukherji, 2007. "India-Sri Lanka Bilateral Free Trade Agreement : Six Years Performance and Beyond," Trade Working Papers 22104, East Asian Bureau of Economic Research.
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