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Optimal energy policy for a carbon tax in Japan

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  • Shibata, Tsubasa

Abstract

Climate change is a global challenge that must be addressed at the international level. In December 2015, the Paris Agreement was adopted at the 21st session of the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP21) held in Paris. The Paris agreement is aimed at keeping global temperature increases below 2 °C. Toward this goal, the Japanese government plans to reduce greenhouse gas emissions by 26% by fiscal year 2030 compared with fiscal year 2013. In this study, we evaluate the feasibility of Japan’s energy policy for reducing CO2 emissions. We construct a macroeconometric model linked to an energy model to show the optimal future energy policy for Japan by applying optimal control to the social welfare function.

Suggested Citation

  • Shibata, Tsubasa, 2017. "Optimal energy policy for a carbon tax in Japan," IDE Discussion Papers 656, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    • Handle: RePEc:jet:dpaper:dpaper656
    as

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    References listed on IDEAS

    as
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    2. Chow, Gregory C, 1978. "Evaluation of Macroeconomic Policies by Stochastic Control Techniques," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 19(2), pages 311-319, June.
    3. Hiroyuki Kosaka & Takashi Yano, 2001. "Assessing Optimal CO2 Abatement Policies for the Kyoto Protocol: A Genetic Algorithms Approach," ERSA conference papers ersa01p32, European Regional Science Association.
    4. Ann F. Friedlaender, 1973. "Macro Policy Goals in the Postwar Period: A Study in Revealed Preference," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 87(1), pages 25-43.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Energy policy; Climatic change; Environmental problems; Carbon tax; Energy model; Macroeconometric model; Optimal control;
    All these keywords.

    JEL classification:

    • C30 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - General
    • P28 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Natural Resources; Environment
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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