Internationally Coordinated Emission Permit Policies: An Option for Withdrawers from the Kyoto Protocol?

This paper investigates the welfare costs of unilateral versus internationally coordinated emission permit policies in a two-country overlapping generations model with producer carbon emissions. We show that, for a net foreign debtor country, the domestic welfare costs of a unilateral domestic permit policy are larger than of an internationally coordinated policy if the world economy is dynamically efficient. From the perspective of a net foreign debtor country that has withdrawn from the Kyoto Protocol, an internationally coordinated permit policy is dominated by climate political inaction also in the post-Kyoto era since bearing the costs of foreign actionism is cheaper, in terms of welfare, than agreeing on international policy coordination unless the world economy becomes dynamically inefficient.emission permit policies, trade, overlapping generations, welfare

Internationally coordinated emission permit policies : an option for withdrawers from the Kyoto protocol?

This paper investigates the welfare costs of unilateral versus internationally coordinated emission permit policies in a two-country overlapping generations model with producer carbon emissions. We show that, for a net foreign debtor country, the domestic welfare costs of a unilateral domestic permit policy are larger than of an internationally coordinated policy if the world economy is dynamically efficient. From the perspective of a net foreign debtor country that has withdrawn from the Kyoto Protocol, an internationally coordinated permit policy is dominated by climate political inaction also in the post-Kyoto era since bearing the costs of foreign actionism is cheaper, in terms of welfare, than agreeing on international policy coordination - unless the world economy becomes dynamically inefficient

The Carbon Content of Austrian Trade Flows in the European and International Trade Context

In this study CO2 emissions embodied in Austrian international trade are quantified employing a 66-region input output model of multidirectional trade. We find that Austria’s final demand CO2 responsibilities on a global scale are 38% higher than conventional statistics report (110 Mt-CO2 versus 79 Mt-CO2 in 2004). For each unit of Austrian final demand, currently two thirds of the thus triggered CO2 emissions occur outside Austrian borders. We then develop a 19-region computable general equilibrium model of Austria and its major trading partners and world regions to find that future Austrian climate policy can achieve the EU 20-20 emission reduction targets, but that its carbon trade balance would worsen considerably. Both unilateral EU and internationally coordinated climate policies affect Austrian international trade stronger than its domestic production.Multi-regional Input-Output Analysis, Multi-regional Computable General Equilibrium, Embodied emissions, Consumption-based principle, Carbon Leakage, Carbon dioxide, Unilateral Climate Policy

The Carbon Content of Austrian Trade Flows in the European and International Trade Context

In this study CO2 emissions embodied in Austrian international trade are quantified employing a 66-region input output model of multidirectional trade. We find that Austria's final demand CO2 responsibilities on a global scale are 38% higher than conventional statistics report (110 Mt-CO2 versus 79 Mt-CO2 in 2004). For each unit of Austrian final demand, currently two thirds of the thus triggered CO2 emissions occur outside Austrian borders. We then develop a 19-region computable general equilibrium model of Austria and its major trading partners and world regions to find that future Austrian climate policy can achieve the EU 20-20 emission reduction targets, but that its carbon trade balance would worsen considerably. Both unilateral EU and internationally coordinated climate policies affect Austrian international trade stronger than its domestic production

EXISTENCE AND EFFICIENCY OF STATIONARY STATES IN A RENEWABLE RESOURCE BASED OLG MODEL WITH DIFFERENT HARVEST COSTS

https://doi.org/10.1515/subboec-2017-0011 In a renewable resource based overlapping generations (OLG) model without harvest costs, a complex combination of the time discount factor, the resource production share, and the natural regeneration rate ensure the existence of a stationary market equilibrium and its intergenerational efficiency when the own rate of return on natural capital is positive. This paper investigates to what extent previous findings carry over to an OLG economy with two types of unit harvest costs (constant, inverse stock dependent) arising from the competition for labor between resource harvesting and resource processing. In contrast to the model without harvest cost, we show why large unit harvest costs, surprisingly, do not require a complex combination of basic parameters for the existence of a stationary state, and that in the model with stock dependent costs intergenerational efficiency might occur even when the own rate of return on natural capital is negative. JEL classification: C62; D90; Q2

Adaptation to transboundary climate risks in trade: investigating actors and strategies for an emerging challenge

There is growing recognition that international trade can transmit climate risks across borders, requiring new forms of and approaches to adaptation. This advanced review synthesizes knowledge on how, by whom and where adaptation actions can be taken in the agriculture and industrial sectors to reduce these transboundary climate risks (TCRs). We find a material difference in the literature on TCRs in agriculture as compared with industrial sectors. Operational and market risks, in particular reductions in food availability, dominate in agriculture, while supply chain and trade-related risks are highlighted for industry. While the origin of the risk (source) is the primary target of adaptation to agricultural TCRs, the general governance structure, such as UNFCCC and WTO deliberations, are important targets in both sectors. Adaptation at the country of destination and along the trade network is of minor importance in both sectors. Regarding the type of adaptation option, agriculture heavily relies on trade policy, agricultural adaptation, and adaptation planning and coordination, while in industry knowledge creation, research and development, and risk management are seen as essential. Governments and the international community are identified as key actors, complemented by businesses and research as critical players in industry. Some measures, such as protectionist trade policies and irrigation, are controversial as they shift risks across countries and sectors, rather than reduce them. While more research is needed, this review shows that a critical mass of evidence on adaptation to TCRs is beginning to emerge, particularly underscoring the importance of international coordination mechanisms. This article is categorized under:. Vulnerability and Adaptation to Climate Change > Institutions for Adaptation Vulnerability and Adaptation to Climate Change > Multilevel and Transnational Climate Change Governance