Guangdong, as China’s most affluent province, which is representative in terms of its industrial and energy consumption structure, will deal with an important issue about how to change its environmental management policies from command-and-control strategies to incentive-based ones and how to exert its effects to the greatest extent possible in the new situation of the impending imposition of a...

We demonstrate that the carbon tax imposed by the Canadian province of British Columbia caused a decline in short-run gasoline demand that is significantly greater than would be expected from an equivalent increase in the market price of gasoline. That the carbon tax is more salient, or yields a larger change in demand than equivalent market price movements, is robust to a range of specificatio...

The paper considers the sustainable trade credit and inventory policies with demand related to credit period and the environmental sensitivity of consumers under the carbon cap-and-trade and carbon tax regulations. First, the decision models are constructed under three cases: without regulation, carbon cap-and-trade regulation, and carbon tax regulation. The optimal solutions of the retailer in...

This paper develops several points concerning the design and implementation of a carbon tax. First, if implemented without any offsetting changes in transfer programs, the carbon tax would be regressive. This regressivity could be offset with changes in either the direct tax system or transfers. Second, the production and consumption distortions associated with small carbon taxes, on the order ...

In this paper, analysis is presented relating to the impact of border tax adjustments for climate policy on the international competitiveness of energy-intensive industries, and the related problem of carbon leakage. While many of the economic and legal issues are not particularly new, climate policy does present some possible twists to the analysis of border tax adjustments when vertically-rel...

We demonstrate that the carbon tax imposed by the Canadian province of British Columbia, a unique carbon pricing policy that comprehensively applies to all fossil fuels, caused a decline in short-run gasoline demand that is significantly greater than would be expected from an equivalent increase in the market price of gasoline. That the carbon tax is more salient, or yields a larger change in d...

This paper develops a global model of climate policy, focusing on the choice between tax and cap-and-trade solutions. We assume that the world can be split into two regions, with two fuels that both lead to carbon emissions. Region A consumes all fuels, and is responsible for defining and implementing climate policy. Region B produces all of fuel 1 (oil), while fuel 2 (interpreted as either coa...

Simulation experiments are conducted, comparing the effects of a common reduction of CO2 emissions within the European Union to a Swedish unilateral decision to reduce CO2 emissions. A numerical general equilibrium model, GEME3, has been used as analytical tool. The model covers all European Union countries, with production disaggregated into 18 sectors. The 13 consumption goods included are cl...

1 Overview This document studies the sensitivity of the optimal carbon tax formulation derived by Golosov, Hassler, Krusell, and Tsyvinski (2013) ("GHKT"). GHKT show that, under certain assumptions, the optimal carbon tax-GDP ratio can be solved for in closed form, and does not depend on the paths of future output, consumption, and technological change. These assumptions include logarithmic pre...

Do carbon taxes kill jobs? With pricing at $30/tonne of carbon dioxide equivalent emissions, the BC policy is currently the most aggressive revenue-neutral carbon tax and serves as a role model for many jurisdictions world-wide. There are concerns, however, that this policy negatively impacts employment. This study uses firm-level synthetic control methods (SCM) to estimate employment effects o...