addressing leakage in the eu ets border adjustment or output based allocation the eu ets has been criticised for threatening the competitiveness of european industry and generating carbon leakage i e increasing foreign greenhouse gas emissions two main options have been put forward to tackle these concerns border adjustments and output based allocation i e allocation of free allowances in proportion to current production we compare various configurations of these two options as well as a scenario with full auctioning and no border adjustment against this background we develop a model of the main sectors covered by the eu ets electricity steel cement and aluminium we conclude that the most efficient way to tackle leakage is auctioning with border adjustment which generally induces a negative leakage a spillover this holds even if the border adjustment does not include indirect emissions if it is based on eu rather than foreign specific emissions or for some values of the parameters if it covers only imports another relatively efficient policy is to combine auctioning in the electricity sector and output based allocation in exposed industries especially if free allowances are given both for direct and indirect emissions i e those generated by the generation of the electricity consumed although output based allocation is generally less effective than border adjustment to tackle leakage it is more effective to mitigate production losses in the sectors affected by the ets which may ease climate policy adoption c 2011 elsevier b v all rights reserved

collective bargaining arrangements closed shops and relative pay this paper uses establishment level data to examine the impact on union nonunion pay differentials of the industrial relations setting in which bargaining takes place the pre entry closed shop is found to be of prime importance for the pay of both skilled and semiskilled manual workers for skilled workers and for semiskilled workers in larger establishments the differentials are found to be insignificantly different from zero in the absence of a pre entry closed shop copyright 1987 by royal economic society

capital malleability emission leakage and the cost of partial climate policies general equilibrium analysis of the european union emission trading system computable general equilibrium cge models are the premier analytical platform for assessing the economic impacts of climate change mitigation but these models tend to treat physical capital as malleable capable of reallocation among sectors over the time period for which equilibrium is solved because the extent to which capital adjustment costs might dampen reallocation is not well understood there is concern that cge assessments understate the true costs of greenhouse gas ghg reduction policies this paper uses a multi region multi sector cge model to investigate cap and trade schemes such as the european union emission trading system which cover a subset of the economy elucidating the effects of capital malleability on ghg abatement the potential for emission leakage from abating to non abating sectors and the impacts on welfare to simplify the complex interactions being simulated within the cge model that analysis is complemented with an analytical model a partial climate policy results in negative internal carbon leakage with emissions declining not only in capped sectors but also in non regulated ones this result is stronger when capital is intersectorally mobile interestingly in partial climate policy settings capital malleability can amplify or attenuate welfare losses depending on the attributes of the economy

how do learning externalities influence the evaluation of ontario s renewables support policies abstract support programs for renewable electricity generation in ontario have been in place since 2005 including feed in tariffs and a competitive procurement process these programs have been criticized on a number of fronts in particular critics claim the level of support was excessive and creating surplus supply however prior studies have ignored one potential benefit of renewable energy support that it can help to promote cost reductions in new technologies through learning by doing this paper uses a recursive dynamic computable general equilibrium cge model featuring learning by doing effects to assess the renewable support programs provided in ontario our results in line with previous studies do not justify the high support rates paid in ontario given our core range of assumptions but our modeling approach allows us to identify the combination of key parameter values relating to learning effects and environmental damages that justify the observed rates these parameters are hard to measure empirically and our modeling approach introduces a new tool for examining the impact of variations in these parameters on policy analysis

nonlinearities in economic dynamics two reasons that led to the dominance of the linear stochastic difference equations approach the first one was the fact that the nonlinear systems seemed incapable of reproducing the statistical aspects of actual economic time series at best such models were able to produce periodic motion1 and an examination of the spectra of economic time series showed the absence of the spikes that characterise periodic data the emphasis on the equilibrium approach to aggregate economic behaviour cf lucas i 986 would make things even more difficult the plethora of stability results for models of infinitely lived agents with perfect foresight turnpike theorems suggested that even the regular fluctuations that had been derived in the literature on endogenous business cycles were incompatible with a theory that had solid microeconomic foundations further this indicated that while nonlinearities could be present the explanations of the fluctuations had to rest solely on the presence of exogenous shocks that working through the equilibrating mechanism would create the observed randomness if such shocks were absent the system would tend to a stationary state the second reason was the empirical success of the models based on linear stochastic difference equations low order autoregressive processes captured some of the features of aggregate time series in turn these processes can in principle result from an economy with complete markets where production is subject to exogenous shocks though the task of confronting these equilibrium models with actual data has not yielded uncontroversial results see the discussion and references in section i there was no obvious gain in the

environmental and economic effects of the copenhagen pledges and more ambitious emission reduction targets abstract a multi region multi sector dynamic computable general equilibrium model is applied to explore the economic and welfare effects of the pledges submitted by developed countries annex i countries and major developing non annex i countries for 2020 under the copenhagen accord in addition to analyzing scenarios reflecting the upper and lower bounds of the copenhagen pledges one additional policy scenario where annex i countries as a group reduce co 2 emissions by 30 in 2020 compared to 1990 levels and where major non annex i countries reduce co 2 emissions 15 below baseline is also analyzed economic effects are measured as changes in gdp compared to baseline and welfare effects are measured via the equivalent variation assuming that countries with emission targets may trade certificates average reductions in gdp for countries with targets range between 0 1 and 0 7 in 2020 for the policy scenarios while the gdp losses are larger for major non annex i countries with emission targets compared to annex i countries this is not the case for the changes in welfare with the exception of mexico the welfare losses for the major non annex i regions as a percentage of projected gdp in 2020 are lower than for the large annex i countries

on the indeterminacy of capital accumulation paths abstract in neoclassical optimal growth models the stability of the accumulation paths depends on the discount parameter we prove that for discount factors small enough the policy function which describes an optimal path can be of any type the result is achieved using the notion of concavity we adopt a constructive approach given any twice differentiable map we show how to construct an optimal growth problem which produces that map as the optimal policy function a consequence is that chaos can appear in these models we also provide bounds on the values of the discount parameter for which indeterminacy is possible

trading for the future signaling in permit markets abstract permit markets are celebrated as a policy instrument since they allow i firms to equalize marginal costs through trade and ii the regulator to distribute the burden in a politically desirable way these two concerns however may conflict in a dynamic setting anticipating the regulator s future desire to give more permits to firms that appear to need them firms purchase permits to signal their need this raises the price above marginal costs and the market becomes inefficient if the social cost of pollution is high and the government intervenes frequently in the market the distortions are greater than the gains from trade and non tradable permits are better the analysis helps to understand permit markets and how they should be designed

climate change taxes and energy efficiency in japan in 2003 japan proposed a climate change tax to reduce its co2 emissions to the level required by the kyoto protocol if implemented the tax would be levied on fossil fuel use and the revenue distributed to encourage the purchase of energy efficient equipment analysis using the mit emissions prediction and policy analysis eppa model shows that this policy is unlikely to bring japan into compliance with its kyoto target unless the subsidy encourages improvement in energy intensity well beyond japan s recent historical experience similar demand management programs in the us where there has been extensive experience have not been nearly as effective as they would need to be to achieve energy efficiency goals of the proposal the tax proposal also calls for limits on international emission trading we find that this limit substantially affects costs of compliance the welfare loss with full emissions trading is 1 6 that when japan meets its target though domestic actions only the carbon price is lower and there is a smaller loss of energy intensive exports japan can achieve substantial savings from emissions trading even under cases where for example the full amount of the russian allowance is not available in international markets

has the large firm training advantage declined during the 2000s the study examines data from the survey of income and program participation sipp and finds a falling incidence of job training in the united states during the period between 2001 and 2009 it als

sulfur dioxide control by electric utilities what are the gains from trade title iv of the 1990 clean air act amendments caaa established a market for transferable sulfur dioxide so2 emission allowances among electric utilities this market offers firms facing high marginal abatement costs the opportunity to purchase the right to emit so2 from firms with lower costs and this is expected to yield cost savings compared to a command and control approach to environmental regulation this paper uses econometrically estimated marginal abatement cost functions for power plants affected by title iv of the caaa to evaluate the performance of the so2 allowance market specifically we investigate whether the much heralded fall in the cost of abating so2 compared to original estimates can be attributed to allowance trading we demonstrate that for plants that use low sulfur coal to reduce so2 emissions technical change and the fall in prices of low sulfur coal have lowered marginal abatement cost curves by over 50 percent since 1985 the flexibility to take advantage of these chan

renewable energy expansion in the chilean power market a dynamic general equilibrium modeling approach to determine co2 emission baselines abstract over the last decade a high dependency on carbon intensive fuels in the chilean power sector has led to environmental concerns particularly regarding rapid growth in co2 emissions more recently the power sector has experienced significant structural changes with a rapid expansion of renewables in the energy matrix and this trend is expected to cause significant variations in future co2 emission baseline scenarios to investigate the economy wide impact of renewable energy expansions in chile s energy mix this research based on a computable general equilibrium cge model examines different co2 emission baseline scenarios however because traditional cge modeling approaches cannot capture the impact of a sector s recent structural changes we present a step by step approach to incorporate different energy matrices from an external engineering bottom up model into the cge model the results indicate that the business as usual bau scenario in which structural changes are not considered significantly overstates expected emissions conversely considering structural changes in our cge model shows chile advancing towards its declared nationally determined contribution ndc to reduce greenhouse gas emissions furthermore the methodology implemented in the study has the advantage of being a simple integrated approach that is coherent with current modeling capacities in many developing contexts

the economic effects of multiple unionism evidence from the 1984 workplace industrial survey establishment level data from the 1984 workplace industrial relations survey are used to investigate the relationship between the presence of multiple recognized unions and wages financial performance and the incidence of industrial action where multiple unions are present it is found to be important to distinguish between whether they bargain separately or jointly and the most important effects are isolated where separate bargains occur the results suggest that plants with multiunionism and separate bargaining arrangements pay higher wages have lower financial performance and are more prone to strike action lasting at least one day copyright 1993 by the editors of the scandinavian journal of economics

marginal abatement costs of co2 emissions in the thermal power sector a regional empirical analysis from china abstract quantifying marginal abatement costs of co2 emissions are beneficial to estimate mitigation potentials and costs of china s regional thermal power sector based on the panel data of 30 provinces from 2004 to 2013 this study estimates the technical efficiency reduction potential and marginal abatement costs of co2 emissions from the thermal power sector in china using a parametric quadratic directional output distance function a regression analysis is undertaken to identify the factors that drive marginal abatement costs the main results are 1 the mean value of directional output distance function in china s thermal power sector is 0 0449 indicating that inefficient production of chinese thermal power sector accounts for 4 49 co2 emissions could be mitigated by accumulated 1 22 billion ton in the past ten year which is approximate 4 49 of total co2 emissions 2 the national weighted average marginal abatement costs of co2 emissions are 316 51 yuan ton which is far higher than carbon price in the current ets emission trading system pilots in china implying that carbon price does not inflect supply and demand of carbon allowance 3 the regression results show that the marginal abatement costs positively connect with regional power scale namely a 1 increase in power scale will result in a 13 8 increase technology level coal supply and power structure are negatively correlated with marginal abatement costs namely a 1 increase in technology level coal supply and power structure will result respectively in a 30 41 4 38 and 77 7 decrease

stationary sunspot equilibria in a finance constrained economy abstract stationary sunspot equilibria are shown to exist in a production economy with infinite lived agents when it is not possible to borrow against future wage income equilibrium fluctuations exhibit persistence over time scales of the same order of magnitude as observed business cycles an active fiscal policy that stabilizes aggregate money expenditures can prevent such fluctuations

synergizing china s energy and carbon mitigation goals general equilibrium modeling and policy assessment abstract in this work we enrich the technical details of the energy sector by extending the conventional framework of computable general equilibrium cge modeling and we take into account uncertainty regarding fossil fueled technologies and endogenous nonfossil energy technological change which provides us with formidable benefits to explore the policy synergy of china s multiple energy development and carbon control targets we find that carbon pricing policy plays a consistently negative role in economic growth while the economic impacts of nonfossil investment incentives differ in their policy stringency compared to energy intensity reduction goals that could be easily attained given the baseline effort achieving carbon peaking targets may be relatively difficult without additional policy intervention and the policy efforts required to reach energy consumption control targets in 2030 and nonfossil energy development targets in 2050 are even stricter this research also identifies significant policy effect differences in carbon pricing and nonfossil investment incentives

regional employment and economic growth effects of south africa s transition to low carbon energy supply mix abstract this paper examines the long run regional economic effects within south africa of changing the electricity generation mix towards less coal to do so a regional computable general equilibrium cge model of south africa is employed for the analysis the overall result stemmed from all scenarios suggest that the effect of a transition to an energy supply mix with smaller share of coal generation is sensitive to other economic and policy conditions in particular the reaction of the global coal market and hence south africa s coal exports under conditions in which surplus coal resulting from lower domestic demand cannot be readily exported the economies of coal producing regions in south africa such as the mpumalanga province are the most severely affected the subsequent migration of semi skilled labour from that province to others within the country require appropriate and timeous planning by energy policymakers and urban planners

general equilibrium electricity generation technologies and the cost of carbon abatement a structural sensitivity analysis abstract electricity generation is a major contributor to carbon dioxide emissions and abatement in this sector is a key determinant of economy wide regulation costs the complexity of an integrated representation of economic and electricity systems makes simplifying assumptions appealing but there is no evidence in the literature on how important the pitfalls may be the aim of this paper is to provide such evidence drawing on numerical simulations from a suite of partial and general equilibrium models that share common technological features and are calibrated to the same benchmark data we report two basic findings first general equilibrium inter sectoral effects of an economy wide carbon policy are large it follows that assessing abatement potentials and price changes in the electricity sector with a partial equilibrium marshallian demand can only provide a crude approximation of the complex demand side interactions second we provide evidence that widely used top down representations of electricity technologies produce fuel substitution patterns that are inconsistent with bottom up cost data this supports the view that the parametrization of substitution possibilities with highly aggregated production functions is difficult to validate empirically the overall picture that emerges is one of large quantitative and even qualitative differences highlighting the role of key structural assumptions in the interpretation of climate policy projections

carbon abatement and international spillovers carbon abatement policies in large open economies affect both the allocation of domestic resources and international market prices a change in international prices implies an indirect secondary burden or benefit for all trading countries based on simulations with a large scale computable general equilibrium model of global trade and energy use we show that international spillovers have important welfare implications for carbon abatement policies designed to meet exogenous emission reduction targets we present a decomposition of the total welfare effect of carbon abatement policies into a primary domestic market effect at constant international prices and a secondary international spillover impact as a result of changes in international prices this decomposition reveals the extent to which domestic abatement costs are increased or decreased as a result of the impact of carbon abatement on international prices

the impacts of china s household consumption expenditure patterns on energy demand and carbon emissions towards 2050 abstract this paper explores how china s household consumption patterns over the period 2005 2050 influence the total energy demand and carbon dioxide co2 emissions in two baseline scenarios and how it influences carbon prices as well as the economic cost in the corresponding carbon mitigation scenarios to this end we first put forward two possible household consumption expenditure patterns up to 2050 using the working leser model taking into account total expenditure increase and urbanization for comparison both expenditure patterns are then incorporated in a hybrid recursive dynamic computable general equilibrium model the results reveal that as income level increases in the coming decades the direct and indirect household energy requirements and co2 emissions would rise drastically when household expenditure shifts from material products and transport to service oriented goods around 21 000 mtce 1 of primary energy and 45 billion tons of co2 emissions would be saved over the 45 year period from 2005 to 2050 moreover carbon prices in the dematerialized mitigation scenario would fall by 13 in 2050 thus reducing the economic cost

british unions in decline determinants of the 1980s fall in union recognition this examination of establishment level data from the workplace industrial relations surveys of 1980 1984 and 1990 shows that the proportion of british establishments that is workplaces in both the private and public sector that recognized unions for collective bargaining over pay and working conditions fell by almost 20 between 1980 and 1990 largely accountable for this decline was a much lower rate of union recognition in establishments founded in the 1980s than in previous years particularly in the private sector citing these findings as well as recent structural changes in employment in the british labor market such as the shift from manufacturing to services from manual to non manual employment and from full time to part time work and a government that continues to enact anti union legislation the authors foresee no reversal of unions decline in the 1990s

transition losses of partially mobile industry specific capital in estimating the economic effects of public policy comparative static models typically assume homogenous factors that are either mobile or immobile for changes designed to improve factor allocations the former assumption would overstate welfare gains while the latter would understate them the model in this paper restricts each industry s capital reduction to its rate of depreciation the stock of depreciated capital represents an industry specific type of capital that may earn a lower equilibrium return this model suggests that previous estimates of efficiency gains from integration of u s personal and corporate income taxes are overstated by 5 billion

eu climate policy up to 2020 an economic impact assessment in its fight against climate change the eu is committed to reducing its overall greenhouse gas emissions to at least 20 below 1990 levels by 2020 to meet this commitment the eu builds on segmented market regulation with an eu wide cap and trade system for emissions from energy intensive installations ets sectors and additional measures by each eu member state covering emission sources outside the cap and trade system the non ets sector furthermore the eu has launched additional policy measures such as renewable energy subsidies in order to promote compliance with the climate policy target basic economic reasoning suggests that emission market segmentation and overlapping regulation can create substantial excess costs if we focus only on the climate policy target in this paper we evaluate the economic impacts of eu climate policy based on numerical simulations with a computable general equilibrium model of international trade and energy use our results highlight the importance of initial market distortions and imperfections as well as alternative baseline projections for the appropriate assessment of eu compliance cost

nonlinearity and chaos in economic models implications for policy decisions this survey paper discusses the policy implications that can be expected from the recent research on nonlinearity and chaos in economic models expected policy implications are interpreted as a driving force behind the recent proliferation of research in this area in general it appears that no new justification for policy intervention is developed in models of endogenous fluctuations although this conclusion depends in part on the definition of equilibrium when justified however policy tends to be very effective in these models copyright 1993 by royal economic society

the synthesis of bottom up and top down approaches to climate policy modeling electric power technology detail in a social accounting framework abstract hybrid climate policy simulations have sought to bridge the gap between bottom up engineering and top down macroeconomic models by integrating the former s energy technology detail into the latter s macroeconomic framework construction of hybrid models is complicated by the need to numerically calibrate them to multiple incommensurate sources of economic and engineering data i develop a solution to this problem following howitt s howitt r e 1995 positive mathematical programming american journal of agricultural economics 77 329 342 positive mathematical programming approach using data for the u s i illustrate how the inputs to the electricity sector in a social accounting matrix may be allocated among discrete types of generation so as to be consistent with both technologies input shares from engineering cost estimates and the zero profit and market clearance conditions of the sector s macroeconomic production structure

equilibrium models displaying endogenous fluctuations and chaos abstract this paper surveys current developments in dynamic general equilibrium theory concerned with conditions under which endogenous fluctuations are possible existing contributions are divided into two classes the larger one consists of models with a unique perfect foresight equilibrium while the second includes models where equilibrium is indeterminate and the set of equilibria involving endogenous fluctuations includes sunspots equilibria while the two classes of models involve oscillations of different natures and with different policy implications we show that both are consistent with optimizing behavior and competitive equilibrium

chaos significance mechanism and economic applications imagine a bargaining model say involving diplomats negotiating tariff levels or a disarmament treaty in which each party has been instructed by higher headquarters to respond to each new offer by her opposite number with a counteroffer that is to be calculated from a simple reaction function provided in advance both negotiating parties are prohibited from revealing their own reaction functions to the other if the perfectly deterministic sequence of offers and counteroffers that must emerge from these simple rules were to begin to oscillate wildly and apparently at random the negotiations could easily break down as each party not understanding the source of the problem came to suspect the other side of duplicity and sabotage yet all that may be involved as we will see is the phenomenon referred to as chaos a case that is emphatically not pathological but in which a dynamic mechanism that is very simple and deterministic yields a time path so complicated that it will pass most standard tests of randomness chaos has become a subject of great interest to specialists and nonspecialists alike besides economics it has entered the literature of geometry physics ecology and meteorology it has been written about at length in the new york times magazine and scientific american as well as technical publications this article seeks to describe what it is how it works and what it means for economics

the failure of training in britain analysis and prescription in the last decade education and training et reform has become a major issue in many of the world s industrial powers one theme which runs throughout these reform initiatives is the need to adapt et systems to the changing economic environment these changes include the increasing integration of world markets the shift in mass manufacturing towards newly developed nations and the rapid development of new technologies most notably information technologies education and training are seen to play a crucial role in restoring or maintaining international competitiveness both on the macro level by easing the transition of the workforce into new industries and at the micro level where firms producing high quality specialized goods and services require a well qualified workforce capable of rapid adjustment in the work process and continual product innovation this paper will highlight the need for policy makers and academics to take account of the two way nature of the relationship between et and the economy

does delegation increase worker training we model a principal firm offering training to its agent worker under two alternative organizational structures integration where the principal retains authority to overrule the investment project recommended by the worker and delegation where the principal cannot overrule the worker s preferred investment project we assume that training reduces the worker s effort cost of assembling information about alternative projects payoffs and identify the conditions under which delegation increases the profit maximizing intensity of training empirical estimates from matched employer employee data show that workplaces delegating authority do provide more worker training this result persists in two cross sections in panel fixed effect estimates and critically in an instrumental variable exercise that also controls for establishment fixed effects jel d21 d22 d23 m53 m54

stabilizing competitive business cycles abstract we study how stylized monetary proportional money transfers fiscal lump sum money transfers and public expenditure policies may eliminate endogenous deterministic cycles and stationary markov sunspot equilibria in a simple version of the overlapping generations model we also present new constructive methods for analyzing stationary markov sunspot equilibria in such a framework

the economics of pollution permit banking in the context of title iv of the 1990 clean air act amendments abstract this paper presents a model of the collective emission permit banking behavior of electricity generating units affected by title iv of the clean air act amendments of 1990 a rigorous treatment of the constraint that pollution permits cannot be borrowed from future allocations is introduced this approach enables an analysis of the impact of future changes in electricity demand regulations and technologies on the present permit price and emissions level the effect of uncertainty on the banking behavior is also explored

technology detail in a multisector cge model transport under climate policy a set of three analytical models is used to study the imbedding of specific transport technologies within a multisector multiregion evaluation of constraints on greenhouse emissions the key parameters of a computable general equilibrium cge model are set to mimic the behavior of a model of modal splits and a market allocation markal model of household and industry transport activities in simulation mode the cge model provides key economic data to an analysis of the details of transport technology under policy restraint results focus on the penetration of new automobile technologies into the vehicle market

europe s climate goals and the electricity sector abstract eu s objective of attaining 20 reductions in greenhouse gas emissions by 2020 is analysed with a general equilibrium model detailing electricity generation technologies and capital vintaging consistent with theory and other analysts we find that the nonuniform treatment of emitting sectors in eu raises abatement costs by a factor of two to three under cost effective emission reductions a more comprehensive tradable cap electricity generation abates more than its proportional share in emissions the european economy abates by substitution towards natural gas by energy efficiency improvements and by reductions in emission intensive manufactures applied policies such as renewable support and responses such as carbon leakage hold down the prices for emission and electricity thus also holds down incentives for energy efficiency and technological change this leads to little preparation for the future and global mitigation

the impact of trade union membership on training in britain in order to measure the union non union training differential in britain a recursive model of training participation and union membership is estimated using data taken from the 1989 labour force survey the results show a positive and significant effect of union membership on training participation in small establishments this is consistent with the hypothesis that any negative impact on employer provided training that might have arisen from the union wage mark up is outweighed by a positive influence exerted by unions through the exercise of collective voice and or reductions in labour turnover by contrast in establishments with 25 or more workers unions have no significant impact on training

sources of training and their impact on wages using data from the national longitudinal survey of youth from 1986 to 1990 the author investigates the wage impact of various sources of training among them company training programs apprenticeships business schools vocational and technical institutes correspondence courses and seminars outside the workplace time spent in training of whatever kind apparently did not affect 1990 wage levels the incidence of two kinds of training however company training and seminars outside work was positively related to wage levels as well as to wage change between 1986 and 1990 that is workers who undertook such training enjoyed higher wages than those who did not time spent in vocational schools was also positively associated with wage change though not with 1990 wage levels the other forms of training had no apparent impact on either wage levels or wage change

the unemployment rate and the business cycle in britain an aggregate and regional analysis jones d manning n and stevenson m 1994 the unemployment rate and the business cycle in britain an aggregate and regional analysis reg studies 28 591 604 it has been suggested that if the business cycle is to be explained then its behaviour should be related to a non linear dynamic process not unlike a limit cycle the time irreversibility exhibited by post war unemployment data is not untypical of a pattern generated by such a non linear structure such a possibility could have important implications for economic policy in certain cases non linearities make forecasting extremely hazardous if not impossible as base line measurement errors cause prediction errors to accumulate at an exponential rate equally worrying is that fundamentally mistaken policy can arise when linear specifications are used to approximate non linear relationships the present paper tests for non linearities in the dynamics of regional unemployment in britain appealing to the idea of a regime switching process we u

economic analysis of a low carbon path to 2050 a case for china india and japan abstract this article studies the economic implications that different global ghg emission mitigation policies may have in the major asian economies namely china india and japan the analysis covers the period 2010 2050 and is performed by means of a recursive dynamic computable general equilibrium model gem e3 four scenarios are investigated the three standard ame scenarios and a fourth scenario with a ghg emission reduction path compatible with the 2 c target reducing global ghg emissions in 2050 by 50 relative to 2005 the scenarios are compared with the already adopted and announced policies of the respective countries in the context of the copenhagen pledges for 2020 and their long term objectives in 2050 we further discuss the role of energy efficiency measures and zero carbon power technologies in order to reach the long term 2 c target we find that postponing significant emission reductions may not accrue an economic benefit over time whereas it may increase some risks by possibly overstretching the reliance on zero carbon technologies

economic impact assessment of turkey s post kyoto vision on emission trading for the post kyoto period turkey strongly emphasizes the establishment of national emission trading system by 2015 and its integration with the eu ets along its accession process to the eu in this paper we study the mechanisms of adjustment and economic welfare consequences of various ets regimes that turkey considers to apply by 2020 i e regional ets and international trading within the eu ets we conduct our analysis under the current eu 20 20 20 emission target 20 and also under its revised version 30 we find that turkey has economic gains from linking with the eu ets under the 20 cap in comparison to the domestic etss despite the eu s welfare loss under linkage in comparison to the case where turkey has domestic abatement efforts it still prefers linking as it increases economic well being compared to the case where turkey does not abate under 30 cutback turkey has critical output loss under linkage due to high abatement burden on the eu while the eu is better off as it passes some of its abatement burden to turkey therefore emission quotas and their allocation across the ets and non ets sectors become highly critical in distributing the overall economic gains from bilateral trading

a sketch of the economics of the greenhouse effect over the last decade scientists have studied extensively the greenhouse effect which holds that the accumulation of carbon dioxide co2 and other greenhouse gases ghgs is expected to produce global warming and other significant climatic changes over the next century see stephen schneider 1989 the present study presents an economic approach for analyzing policies to slow climate change

assessing the impacts of china s environmental tax using a dynamic computable general equilibrium model abstract since 2018 china has put into practice the new environmental protection tax law which levies taxes on non greenhouse pollutants with stringent standards to fully study the socioeconomic and environmental impacts of this policy this paper establishes a dynamic country level compute general equilibrium cge model with the electricity sector disaggregated into 5 technologies and 19 major taxable pollutants included five scenarios are developed including the baseline scenario bau the low environmental tax scenario lowet the high environmental tax scenario highet the low environmental tax and low carbon tax scenario lowetc and the high environmental tax and high carbon tax scenario highetc the simulation results show that the environmental tax could help reduce emissions of most kinds of pollutants but bring negative effects on the gross domestic product gdp compared to the bau scenario the gdp loss by 2030 would be 0 10 0 21 0 32 and 0 67 in the lowet highet lowetc and highetc scenarios the emission of sulphur dioxide so2 will decrease by 3 55 7 15 6 70 and 13 01 and the emission of carbon dioxide co2 will be reduced by 2 21 4 62 8 91 and 16 77 the result also shows that the heavy polluted sectors and energy intensive sectors will suffer higher output loss while the clean energy sectors and service sector will experience an increase in the output in the policy scenarios

a new robustness analysis for climate policy evaluations a cge application for the eu 2020 targets this paper introduces a new method for stochastic sensitivity analysis for computable general equilibrium cge model based on gauss quadrature and applies it to check the robustness of a large scale climate policy evaluation the revised version of the gauss quadrature approach to sensitivity analysis reduces computations considerably vis a vis the commonly applied monte carlo methods this allows for a stochastic sensitivity analysis also for large scale models and multi dimensional changes of parameters in the application an impact assessment of eu2020 climate policy we focus on sectoral elasticities that are part of the basic parameters of the model and have been recently determined by econometric estimation alongside with standard errors the impact assessment is based on the large scale cge model pace we show the applicability of the gauss quadrature approach and confirm the robustness of the impact assessment with the pace model the variance of the central model outcomes is smaller than their mean by order four to eight depending on the aggregation level i e aggregate variables such as gdp show a smaller variance than sectoral output

a literature based multi criteria evaluation of the eu ets abstract this article reviews the existing literature on the european union emission trading scheme eu ets focusing on empirical ex post research since the end of the first period 2007 the literature is presented through a multi criteria evaluation concerning environmental effectiveness despite over allocation during the first period abatement is estimated between 2 5 and 5 trade driven carbon leakage was not observed even if long term economic models predict divergent leakage estimates for certain at risk sectors the abatement target was likely to be below an economically efficient level but was reached in a fairly cost effective way even if free allocation gave rise to several distortional effects equity concerns were manifold and constitute a major drawback to the policy finally institutional feasibility can be considered positive in that the eu ets passed the european legislative process unlike the previously proposed eu wide carbon tax

dynamic formulation of a top down and bottom up merging energy policy model abstract the impact of energy policy measures is not restricted to the energy system and should therefore be analysed within an economy wide framework while keeping the essential details of the energy sector the aim of this paper is to present new developments in the field of the consistent evaluation of indicators for the sustainability assessment of energy policy measures starting from the static concept of bohringer energy econ 20 1998 233 this paper shows how the complementarity format can be used in computable general equilibrium cge modelling for a dynamic formulation of bottom up and top down approach merging models while a hybrid approach increases the credibility of cge models in energy policy analysis by replacing the energy sector generic functional forms with a bottom up activity analysis based on specific technologies the endogenous formulation of investment decisions makes an explicit description of evolving specific capital stocks and technology mixes possible both features are essential when assessing effects of policy measures that may be affected by structural change which is typically the case in the long term assessment of energy policy measures

climate change policy market structure and carbon leakage abstract the 1997 kyoto protocol on climate change obliges the industrialized countries to initiate the international effort of abating anthropogenic greenhouse gas ghg emissions if such an initiative is to be taken the associated competitive effects may lead to significant relocation of developed countries energy intensive production this paper examines this issue i adopt an oligopolistic structure combined with increasing returns to scale production technologies to represent the strategic interaction among the firms producing energy intensive products this representation is then embedded within a multi regional computable general equilibrium model which in turn is used for quantifying these relocational effects the results suggest that significant relocation of energy intensive industries away from the oecd may occur depending on the type of market structure with leakage rates as high as 130 in which case ghg control policies in the industrialized countries actually lead to higher global emissions

the welfare impact of self supplied water pricing in canada a computable general equilibrium assessment this paper uses a computable general equilibrium model to assess the welfare cost of changing the method of water allocation in canada towards one that uses prices to ration demand we model the introduction of a price on both water that is abstracted as well as water that is consumed that is abstracted and not returned to the source we estimate that reducing water consumption by 25 would require imposition of a price on water consumption of around 0 21 text m 3 similarly introduction of a water abstraction charge of about 0 013 text m 3 would be sufficient to reduce water abstraction by 25 we find that if revenues from water pricing are returned in lump sum to households the introduction of water pricing would result in a modest welfare loss when revenues from water pricing are used to offset existing taxes we find a gain in welfare corresponding to a strong double dividend

the synthesis of bottom up and top down approaches to climate policy modeling electric power technologies and the cost of limiting us co2 emissions abstract in the us the bulk of co 2 abatement induced by carbon taxes comes from electric power this paper incorporates technology detail into the electricity sector of a computable general equilibrium model of the us economy to characterize electric power s technological margins of adjustment to carbon taxes and to elucidate their general equilibrium effects compared to the top down production function representation of the electricity sector the technology rich hybrid specification produces less abatement at a higher welfare cost suggesting that bottom up models do not necessarily generate lower costs of abatement than top down models this result is shown to be sensitive to the elasticity with which technologies generating capacities adjust to relative prices

a cost benefit analysis of the eu 20 20 2020 package the european commission did not publish a cost benefit analysis for its 2020 climate package this paper fills that gap comparing the marginal costs and benefits of greenhouse gas emission reduction the uncertainty about the marginal costs of climate change is large and skewed and estimates partly reflect ethical choices e g the discount rate the 2010 carbon price in the eu emissions trading system can readily be justified by a cost benefit analysis emission reduction is not expensive provided that policy is well designed a condition not met by planned eu policy it is probably twice as expensive as needed costing one in ten years of economic growth the eu targets for 2020 are unlikely to meet the benefit cost test for a standard discount rate 3 pure rate of time preference the benefit cost ratio is rather poor 1 30 so that benefits need to be very much higher or costs very much lower than typically assumed to justify the 2020 targets only a very low discount rate 0 prtp would justify the 20 emission reduction target for 2020

optimal environmental taxation in the presence of other taxes general equilibrium analyses this paper examines the optimal setting of environmental taxes in economies where other distortionary taxes are present we employ analytical and numerical models to explore the degree to which in a second best economy optimal environmental tax rates differ from the rates implied by the pigovian principle according to which the optimal tax rate equals the marginal environmental damages both models indicate contrary to what several analysts have suggested that the optimal tax rate on emissions of a given pollutant is generally less than the rate supported by the pigovian principle moreover the optimal rate is lower the larger are the distortions posed by ordinary taxes numerical results indicate that previous studies may have seriously overstated the size of the optimal carbon tax by disregarding pre existing taxes this abstract was borrowed from another version of this item

the eu 20 20 2020 targets an overview of the emf22 assessment three computable general equilibrium models are used to estimate the economic implications of a stylized version of eu climate policy if implemented at the lowest possible cost the 20 emissions reduction would lead to a welfare loss of 0 5 2 0 by 2020 second best policies increase costs a policy with two carbon prices one for the ets one for the non ets could increase costs by up to 50 a policy with 28 carbon prices one for the ets one each for each member state could increase costs by another 40 the renewables standard could raise the costs of emissions reduction by 90 overall the inefficiencies in policy lead to a cost that is 100 125 too high the models differ greatly in the detail of their results the ets non ets split may have a negligible impact on welfare while the renewables standard may even improve welfare the models agree however that the distortions introduced by total eu package imply a substantial welfare loss over and above the costs needed to meet the climate target the marginal total and excess costs reported here are notably higher than those in the impact assessment of the european commission

assessment of china s climate commitment and non fossil energy plan towards 2020 using hybrid aim cge model china made a commitment in copenhagen to reduce its carbon dioxide emissions per unit of gdp from 40 to 45 compared with the 2005 level by 2020 and is determined to vigorously develop non fossil fuels this study analyzes the effects and impacts of policies that could help to achieve china s copenhagen commitments with a hybrid static cge model in which the electricity sector is disaggregated into 12 generation technologies four scenarios are developed including the reference scenario a the reference scenario b and two carbon constraint scenarios the results show that carbon intensity in terms of gdp will fall by 30 97 between 2005 and 2020 in the reference scenario a and will be reduced further by 7 97 if china s targeted non fossil energy development plans can be achieved in the reference scenario b however the rest of the 40 45 target must be realized by other measures such as carbon constraint it is also observed that due to carbon intensity constraints gdp loss would be from 0 032 to 0 24 compared to the reference scenario b and co2 emission reductions are due mainly to decreases in coal consumption in the electricity sector and manufacturing sector

training and union wages abstract this paper investigates whether unions through imposing wage floors that lead to wage compression increase on the job training our analysis focuses on germany based on a model of unions and firm financed training we derive empirical implications regarding apprenticeship training intensity layoffs wage cuts and wage compression in unionized and nonunionized firms we test these implications using firm panel data matched with administrative employee data we find support for the hypothesis that union recognition via imposing minimum wages and wage compression increases training in apprenticeship programs

sensitivity of modeling results to technological and regional details the case of italy s carbon mitigation policy model differences in technological and geographical scales are common but their contributions to uncertainties have not been systematically quantified in the climate policy literature this paper carries out a systematic assessment on the sensitivity of computable general equilibrium models to technological and geographical scales in evaluating the economic impacts of carbon mitigation policies in particular we examine the impacts of sub national details and technological details of power generation on the estimate of carbon price and economic cost taking italy as an example we find that the estimation for carbon price and the economic cost of a de carbonization pathway by means of a model with technological and regional details can be lower than a model without such details by up to 40 additionally the effect of representing regional details appears to be far more important than the effect of representing the details of electricity technology in both the estimated carbon prices and the estimated economic impacts our results for italy highlight the importance of modeling uncertainties of these two key assumptions which should be appropriately acknowledged when applying cge models for policy impact assessment our conclusions can be generalized to different countries and policy scenarios not in terms of absolute numbers but in terms of economic explanations in particular intra national trade and the sub national sectoral technological specialization are important variables for understanding the economic dynamics behind these outcomes

trade unions and training practices in british workplaces the authors use british establishment level data from the 1991 employers manpower and skills practices survey emsps and individual level data from the autumn 1993 quarterly labour force survey qlfs to investigate the links between training provision and workplace unionization both the probability of receiving training and the amount of training received are found to have been substantially higher in unionized than in nonunion workplaces the authors view these results as showing that trade unions can play an important role in developing and boosting skill formation in britain

the impact of climate change on the electricity market a review climate change will impact electricity markets through both electricity demand and supply this paper reviews the research on this topic whereas there is much that remains unknown or uncertain research over the last few years has significantly advanced our knowledge in general higher temperatures are expected to raise electricity demand for cooling decrease demand for heating and to reduce electricity production from thermal power plants the effect of climate change on the supply of electricity from non thermal sources shows great geographical variability due to differences in expected changes to temperature and precipitation whereas the research frontier has advanced significantly in the last few years there still remains a significant need for more research in order to better understand the effects of climate change on the electricity market four significant gaps in the current research are regional studies of demand side impacts for africa asia the caribbean and latin america the effects of extreme weather events on electricity generation transmission and demand changes to the adoption rate of air conditioning and finally our understanding of the sensitivity of thermal power supply to changes in air and water temperatures

assessment of european union transition scenarios with a special focus on the issue of carbon leakage this paper uses the model gemini e3 to simulate and assess the transition scenario to 2020 framed by the european union in its energy climate directive and it raises several issues in this connection after a brief description of the model the paper presents the results of the scenarios mainly the values of the major indicators of carbon price both in the ets and in non ets sectors and the welfare cost of the eu policy under the various configurations considered while it is independent of the scenario in the ets sector in the non ets sector the value of carbon is very sensitive to the provisions of the directive and in particular the option of resorting to the flexibility mechanisms the welfare cost also varies significantly according to scenarios and its value for the entire eu is more than double in the scenario closest to the directive as compared to the least cost one the paper also addresses the very sensitive issue of carbon leakage and argues in favor of a new concept of net leakage the analysis shows that while carbon leakage may affect some specific sectors at the aggregate level it does not represent a real concern with a magnitude of at most a few percent of ghg abatement by annex b countries

the main support mechanisms to finance renewable energy development considering that the major part of greenhouse gases is carbon dioxide there is a global concern aimed at reducing carbon emissions additionally major consumer countries are looking for alternati

unions and efficient training the paper examines the optimal level of training investment when trained workers are mobile wage contracts are time consistent and training comprises both specific and general skills the firm has ex post monopsonistic power that drives trained workers wages below the social optimum the emergence of a trade union bargaining at the firm level can increase social welfare by counterbalancing the firm s ex post monopsonistic power in wage determination local union firm wage bargaining ensures that the post training wage is set sufficiently high to deter at least some quits so that the number of workers the firm trains is nearer the social optimum

imperfect foresight and chaos an example of a self fulfilling mistake abstract we consider an overlapping generations economy with a single production sector and a government first we assume that the households have imperfect foresight in the sense that they cannot distinguish between the trajectories of a deterministic chaotic system and a stochastic process it is shown that mistaking a deterministic chaotic system for a stochastic one is a self fulfilling mistake because the possibility of making this mistake arises only when it is made the unique perfect foresight equilibrium is proved to exhibit simple dynamics for most parameter values finally we show that when agents apply simple econometric models to build their expectations the resulting dynamics resemble the chaotic dynamics of the imperfect foresight equilibrium under certain parameter constellations while they are close to the simple dynamics of the perfect foresight equilibrium for other parameter values

carbon taxes with exemptions in an open economy a general equilibrium analysis of the german tax initiative abstract sectoral exemptions from environmental regulation are applied in many countries to avoid adverse adjustment effects in specific industries the problem with exemptions is that they can make environmental policy more costly our paper analyzes the welfare costs of exemptions in environmental policy together with the issue of unilateral carbon taxes in an open economy several countries within the eu have introduced or contemplated unilateral taxes to reduce anthropogenic co2emissions taxes which are unilaterally imposed in an open economy can have significant impacts on production and employment of energy and export intensive industries to save jobs by maintaining international competitiveness most co2taxation schemes include exemptions for energy and export intensive industries as a compromise between environmental objectives and employment in these sectors this paper shows that such compromises are costly as the tax base narrows the dead weight loss increases our calculations illustrate this point in the framework of a static general equilibrium model for west germany calibrated to 1990 data we evaluate the excess costs of exemptions as a means of saving jobs in specific industries relative to an alternative instrument a uniform carbon tax cum wage subsidy which achieves an identical level of national emissions and employment at a fraction of the cost