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The likely regional impacts of an agricultural emissions policy in New Zealand: Preliminary analysis

  • Isabelle Sin

    (Motu Economic & Public Policy Research)

  • Emma Brunton

    (Motu Economic & Public Policy Research)

  • Joanna Hendy

    (Motu Economic & Public Policy Research)

  • Suzi Kerr

    (Motu Economic & Public Policy Research)

Hendy and Kerr (2005b) find that an emissions charge on agricultural methane and nitrous oxide of $25 per tonne of carbon dioxide (CO2) equivalent would be likely to reduce New Zealand’s net land-use related emissions for commitment period one in the order of 3%, with full accounting. The costs per farmer and as a percentage of profit would be very high. This paper considers the regional impacts of such a policy in New Zealand by allocating the emission charge across space according to the location of animals. We then combine our emissions charge information with data on the socio-economic characteristics of the affected areas. Obviously rural areas are heavily affected. In many respects, for example median income, ethnic mix, and percentage of working people with a university degree, the rural areas most affected have very similar socio-economic characteristics to other parts of rural New Zealand. Only in two ways do they appear to differ. Our findings indicate that areas with high emission costs tend to have high employment rates, but that they also have a disproportionately high number of unqualified people.

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Paper provided by EconWPA in its series Others with number 0509010.

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Length: 35 pages
Date of creation: 12 Sep 2005
Date of revision:
Handle: RePEc:wpa:wuwpot:0509010
Note: Type of Document - pdf; pages: 35
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  1. John Creedy & Catherine Sleeman, 2005. "Carbon Taxation, Prices and Welfare in New Zealand," Department of Economics - Working Papers Series 937, The University of Melbourne.
  2. Papps, Kerry L. & Newell, James O., 2002. "Identifying Functional Labour Market Areas in New Zealand: A Reconnaissance Study Using Travel-to-Work Data," IZA Discussion Papers 443, Institute for the Study of Labor (IZA).
  3. Viv B Hall & C. John McDermott, 2005. "Regional business cycles in New Zealand:Do they exist? What might drive them?," Urban/Regional 0509013, EconWPA.
  4. Antonio M Bento & Lawrence H Goulder & Emeric Henry & Mark R Jacobsen & Roger H. Von Haefen, 2005. "Distributional and Efficiency Impacts of Gasoline Taxes: An Econometrically Based Multi-market Study," Post-Print hal-01020761, HAL.
  5. James M. Poterba, 1991. "Is the Gasoline Tax Regressive?," NBER Working Papers 3578, National Bureau of Economic Research, Inc.
  6. Jorgenson, D.W. & Slesnick, D. & Wilcoxen, P.J., 1992. "Carbon Taxes and Economic Welfare," Harvard Institute of Economic Research Working Papers 1589, Harvard - Institute of Economic Research.
  7. Antonio M. Bento & Lawrence H. Goulder & Emeric Henry & Mark R. Jacobsen & Roger H. von Haefen, 2005. "Distributional and Efficiency Impacts of Gasoline Taxes: An Econometrically Based Multi-market Study," American Economic Review, American Economic Association, vol. 95(2), pages 282-287, May.
  8. Steven Stillman, 2005. "Examining Changes in the Value of Rural Land in New Zealand between 1989 and 2003," Working Papers 05_07, Motu Economic and Public Policy Research.
  9. James M. Poterba, 1991. "Tax Policy to Combat Global Warming: On Designing a Carbon Tax," NBER Working Papers 3649, National Bureau of Economic Research, Inc.
  10. A.L. Bovenberg & Lawrence H. Goulder & Derek J. Gurney, 2003. "Efficiency Costs of Meeting Industry-Distributional Constraints under Environmental Permits and Taxes," NBER Working Papers 10059, National Bureau of Economic Research, Inc.
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