Output-based rebating of carbon taxes in a neighbour's backyard: Competitiveness, leakage and welfare

被引:9
|
作者
Boehringer, Christoph [1 ]
Bye, Brita [2 ]
Faehn, Taran [2 ]
Rosendahl, Knut Einar [3 ]
机构
[1] Carl von Ossietzky Univ Oldenburg, Oldenburg, Germany
[2] Stat Norway, Oslo, Norway
[3] Norwegian Univ Life Sci, As, Norway
关键词
CLIMATE POLICY; DEMAND; TRADE; OIL;
D O I
10.1111/caje.12264
中图分类号
F [经济];
学科分类号
02 ;
摘要
We investigate how, in an open economy, carbon taxes combined with output-based rebating (OBR) perform in interaction with the carbon policies of a large neighbouring trading partner. Analytical results suggest that, whether the purpose of the OBR policy is to compensate firms for carbon tax burdens or to maximize welfare (accounting for global emission reductions), the OBR rate should be positive in policy-relevant cases. Numerical simulations for Canada, with the US as the neighbouring trading partner, indicate that the impact of US policies on the OBR rate will depend crucially on the purpose of the Canadian OBR policies. If, for a given US carbon policy, Canada's aim is to restore the competitiveness of domestic emission-intensive and trade-exposed (EITE) firms to the same level as before the introduction of its own carbon taxation, we find that the necessary domestic OBR rates will be insensitive to the foreign carbon policies. However, if not only the Canadian carbon tax but also an equally high US tax is introduced, compensatory Canadian OBR rates will be up to 50% lower, depending on the sector and on US OBR policy. If the policy objective is to increase economy-wide allocative efficiency (welfare) of Canadian policies by accounting for carbon leakage, the US policies will have only a minor downward pressure on desirable OBR rates in Canada. Practical choices of OBR rates hardly affect overall domestic economic performance; thus, output-based rebating qualifies as an instrument for compensating EITE industries without a large sacrifice in terms of economy-wide allocative efficiency.
引用
收藏
页码:426 / 455
页数:30
相关论文
共 50 条
  • [1] Is there a rationale for output-based rebating of environmental levies?
    Bernard, Alain L.
    Fischer, Carolyn
    Fox, Alan K.
    [J]. RESOURCE AND ENERGY ECONOMICS, 2007, 29 (02) : 83 - 101
  • [2] Output-based allocation of emissions permits for mitigating the leakage and competitiveness issues for the Japanese economy
    Takeda, Shiro
    Arimura, Toshi
    Tamechika, Hanae
    Fischer, Carolyn
    Fox, Alan
    [J]. ENVIRONMENTAL ECONOMICS AND POLICY STUDIES, 2014, 16 (01) : 89 - 110
  • [3] Output-based Allowance Allocations under China's Carbon Intensity Target
    Zhou Jieting
    Duan Maosheng
    Liu Chunmei
    [J]. 2010 INTERNATIONAL CONFERENCE ON ENERGY, ENVIRONMENT AND DEVELOPMENT (ICEED2010), 2011, 5 : 1904 - 1909
  • [4] Using output-based allocations to manage volatility and leakage in pollution markets
    Meunier, Guy
    Montero, Juan-Pablo
    Ponssard, Jean-Pierre
    [J]. ENERGY ECONOMICS, 2017, 68 : 57 - 65
  • [5] Addressing leakage in the EU ETS: Border adjustment or output-based allocation?
    Monjon, Stephanie
    Quirion, Philippe
    [J]. ECOLOGICAL ECONOMICS, 2011, 70 (11) : 1957 - 1971
  • [6] CO2 abatement, competitiveness and leakage in the European cement industry under the EU ETS:: grandfathering versus output-based allocation
    Demailly, Damien
    Quirion, Philippe
    [J]. CLIMATE POLICY, 2006, 6 (01) : 93 - 113
  • [7] Economy-wide and CO2 impacts of carbon taxes and output-based pricing in New Brunswick, Canada
    Withey, Patrick
    Sharma, Chinmay
    Lantz, van
    McMonagle, Galen
    Ochuodho, Thomas O.
    [J]. APPLIED ECONOMICS, 2022, 54 (26) : 2998 - 3015
  • [8] Unilateral consumption-based carbon taxes and negative leakage
    Eichner, Thomas
    Pethig, Ruediger
    [J]. RESOURCE AND ENERGY ECONOMICS, 2015, 40 : 127 - 142
  • [9] CONCILIATING INDUSTRIAL COMPETITIVENESS AND CLIMATE POLICY: OUTPUT-BASED ALLOCATION OF CO2 ALLOWANCES OR BORDER ADJUSTMENT?
    Demailly, Damien
    Quirion, Philippe
    [J]. REVUE ECONOMIQUE, 2008, 59 (03): : 497 - 504
  • [10] Perverse effects of output-based research funding? Butler's Australian case revisited
    van den Besselaar, Peter
    Heyman, Ulf
    Sandstrom, Ulf
    [J]. JOURNAL OF INFORMETRICS, 2017, 11 (03) : 905 - 918