Cap and Trade Versus Carbon Tax: An Analysis Based on a CGE Model

2021 ◽  
Author(s):  
Jin-Feng Zhou ◽  
Dan Wu ◽  
Wei Chen
Keyword(s):  
Carbon Tax ◽  
Cge Model ◽  
Cap And Trade

A factorial CGE model for analyzing the impacts of stepped carbon tax on Chinese economy and carbon emission

2021 ◽  
Vol 759 ◽  
pp. 143512
Author(s):  
Yupeng Fu ◽  
Guohe Huang ◽  
Lirong Liu ◽  
Mengyu Zhai
Keyword(s):  
Carbon Emission ◽  
Carbon Tax ◽  
Chinese Economy ◽  
Cge Model

scholarly journals Carbon tax or cap-and-trade: Which is more viable for Chinese remanufacturing industry?

2020 ◽  
Vol 243 ◽  
pp. 118606 ◽  
Author(s):  
Xu Hu ◽  
Zhaojun Yang ◽  
Jun Sun ◽  
Yali Zhang
Keyword(s):  
Carbon Tax ◽  
Cap And Trade

Carbon tax versus cap-and-trade

2009 ◽  
Vol 18 (4) ◽  
pp. 95-100 ◽  
Author(s):  
Jim DiPeso
Keyword(s):  
Carbon Tax ◽  
Cap And Trade

scholarly journals COMBINING MULTIPLE CLIMATE POLICY INSTRUMENTS: HOW NOT TO DO IT

2010 ◽  
Vol 01 (03) ◽  
pp. 209-225 ◽  
Author(s):  
SAMUEL FANKHAUSER ◽  
CAMERON HEPBURN ◽  
JISUNG PARK
Keyword(s):  
Climate Change ◽  
Carbon Tax ◽  
Climate Change Policy ◽  
Policy Instruments ◽  
Carbon Price ◽  
Reserve Price ◽  
Cap And Trade ◽  
Change Policy ◽  
Hybrid Instruments ◽  
Carbon Prices

Putting a price on carbon is critical for climate change policy. Increasingly, policymakers combine multiple policy tools to achieve this, for example by complementing cap-and-trade schemes with a carbon tax, or with a feed-in tariff. Often, the motivation for doing so is to limit undesirable fluctuations in the carbon price, either from rising too high or falling too low. This paper reviews the implications for the carbon price of combining cap-and-trade with other policy instruments. We find that price intervention may not always have the desired effect. Simply adding a carbon tax to an existing cap-and-trade system reduces the carbon price in the market to such an extent that the overall price signal (tax plus carbon price) may remain unchanged. Generous feed-in tariffs or renewable energy obligations within a capped area have the same effect: they undermine the carbon price in the rest of the trading regime, likely increasing costs without reducing emissions. Policymakers wishing to support carbon prices should turn to hybrid instruments — that is, trading schemes with price-like features, such as an auction reserve price — to make sure their objectives are met.

scholarly journals Climate Change: A Comparison Of Market-Based Instruments From A South African Perspective

2013 ◽  
Vol 12 (4) ◽  
pp. 457 ◽  
Author(s):  
Suren Pillay ◽  
Pieter W Buys
Keyword(s):  
Sustainable Development ◽  
South African ◽  
Carbon Tax ◽  
Developing Economy ◽  
Cap And Trade ◽  
Advantages And Disadvantages ◽  
Key Characteristics ◽  
African Context ◽  
African Perspective ◽  
The Impact

This article aims to consider the relevancy of (i) cap-and-trade schemes and (ii) carbon tax schemes in a developing economy context. Even though both schemes have a common goal of reducing greenhouse gas emissions, they operate very differently, each with their own set of advantages and disadvantages. Sustainable developments comprise various elements categorised in three primary dimensions environmental, economic and social. The objective of reducing greenhouse gases via the implementation of carbon tax or cap-and-trade schemes primarily addresses the environmental dimension of sustainable development. Notwithstanding the aforementioned, the impact of both schemes on the economically sustainable development, including industry competitiveness and growth, still has to be determined. In South Africa, the National Treasury made a decision to implement carbon tax as opposed to cap-and-trade schemes. In this article, the reasoning behind their decision in favour of carbon tax in the South African context is critically considered, firstly by evaluating the key characteristics between cap-and-trade and carbon tax schemes and secondly by considering the effectiveness hereof in the global context. It was found primary reason behind the favourable consideration of carbon tax was the fact the implementation thereof would be simpler using the existing taxation systems, whereas cap-and-trade would require the implementation of sophisticated mechanisms that may not provide the optimum benefit in a developing economy context.

scholarly journals COMPARING “CARBON TAX” AND “CAP AND TRADE” AS MECHANISM TO REDUCE EMISSION IN INDONESIA

2021 ◽  
Vol 11 (5) ◽  
pp. 106-111
Author(s):  
Juris Justitio Hakim Putra ◽  
Nabilla Nabilla ◽  
Fidelia Yemima Jabanto
Keyword(s):  
Carbon Tax ◽  
Cap And Trade

scholarly journals Setting a price for carbon for implementing a carbon tax or a cap and trade system for controlling carbon dioxide emissions

2019 ◽  
Author(s):  
Wenfa Ng
Keyword(s):  
Carbon Dioxide ◽  
Environmental Economics ◽  
Carbon Dioxide Emissions ◽  
Carbon Tax ◽  
Local Economy ◽  
Cap And Trade ◽  
Trading System ◽  
Demand And Supply ◽  
Goods And Services ◽  
Supply Shock

Carbon tax and cap and trade are two main policy tools for market-based mechanisms aimed at curbing carbon dioxide emissions. But, their implementation requires a careful calibration of the price of carbon, on which a carbon tax is levied, or which helps price carbon credits in an emissions trading system. Hence, setting a price on carbon, tuned to the fundamentals of the local economy, is a profound question in environmental economics, important for benchmarking the price of many goods and services dependent on fossil fuel energy for material input or function. One approach to setting a price on carbon is to progressively increase the price of carbon through regulatory statute from an initial low price. This would help industries and the economy to gradually adapt to a marketplace where there is an additional regulatory price on carbon in addition to a material and services price. On the other hand, a one-off approach at setting the final price of carbon in the economy may deliver a severe demand and supply shock, which may have repercussions beyond businesses needing to factor the price of carbon in their economic calculus. Thus, whether a progressive price increase in carbon or setting the final price, pricing carbon is a delicate economic issue with significant implications for the functioning of an economy choosing either the carbon tax or cap and trade system for regulating carbon dioxide emissions.

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