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Impact of Climate Policy on the Basque Economy


  • Mikel González

    (University of Basque Country)

  • Rob Dellink

    (Wageningen University)


In this paper we analyze the economic effects of CO2 emission reductions in the Basque Country (Spain) using an applied general equilibrium (AGE) model with specific attention to environment-energy-economy interactions. Environmental policy is implemented through a system of tradable pollution permits that the government auctions. The costs of different levels of CO2 abatement are discussed, focusing on the variations of macroeconomic, sectoral and environment-energy variables. Results show that the costs for achieving the Kyoto targets can remain limited if the appropriate combination of changes in fuel-mix and restructuring of the economy is induced.

Suggested Citation

  • Mikel González & Rob Dellink, 2005. "Impact of Climate Policy on the Basque Economy," Working Papers 2005.113, Fondazione Eni Enrico Mattei.
  • Handle: RePEc:fem:femwpa:2005.113

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    References listed on IDEAS

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    6. W. Douglass Shaw, 2002. "Testing the Validity of Contingent Behavior Trip Responses," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(2), pages 401-414.
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    Cited by:

    1. Ibon Galarraga & Mikel González-Eguino & Anil Markandya, 2010. "The Role of Regions in Climate Change Policy," Working Papers 2009-04, BC3.
    2. Duarte, Rosa & Mainar, Alfredo & Sánchez-Chóliz, Julio, 2010. "The impact of household consumption patterns on emissions in Spain," Energy Economics, Elsevier, vol. 32(1), pages 176-185, January.
    3. Mikel González-Eguino, 2010. "Market Instruments and CO2 Mitigation: A General Equilibrium Analysis for Spain," Working Papers 2009-02, BC3.

    More about this item


    Applied general equilibrium; Climate change; Tradable pollution permits; Basque country;

    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
    • Q20 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - General
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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