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The Value-Added of Sectoral Disaggregation: Implication on Competitive Consequences of Climate Change Policies

Author

Listed:
  • Victoria Alexeeva-Talebi
  • Andreas Löschel
  • Christoph Böhringer
  • Sebastian Voigt

Abstract

Multi-sector, multi-region computable general equilibrium (CGE) models are typically based on the most recent consistent accounts of region- and sector-specific production, consumption, bilateral trade and energy flows as provided by the GTAP data base. However, even the most recent data base version (GTAP7) does not provide sufficient detail at the sectoral level as it covers energyintensive industries (EII) at a relatively low level of sectoral disaggregation. The latter possesses a significant drawback for the analysis of the carbon leakage risks.Against this background, this paper elaborates on the availability of data resources and methodology of data set construction with a high level of sectoral disaggregation. The extensions in terms of sectoral coverage are carried out to explicitly represent cement, steel and aluminium sector in a CGE model of global trade and energy PACE. In order to perform the sectoral split of EII sectors within the GTAP7 database, additional information on production, energy consumption and trade relations for each subsector are collected and discussed in details.Building upon these prerequisites, the paper evaluates the value-added of sectoral disaggregation efforts by quantifying the macroeconomic implications in two model set-ups: with and without high sectoral disaggregation level.

Suggested Citation

  • Victoria Alexeeva-Talebi & Andreas Löschel & Christoph Böhringer & Sebastian Voigt, 2011. "The Value-Added of Sectoral Disaggregation: Implication on Competitive Consequences of Climate Change Policies," EcoMod2011 3100, EcoMod.
    • Handle: RePEc:ekd:002625:3100
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    JEL classification:

    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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