estimates of effective marginal tax rates on factor incomes this chapter describes a method of calculating summary measures of effective factor income tax rates in the united states using readily available data the numbers resulting from application of this method in a study are reported in the chapter and some of their possible uses are discussed the estimated factor income tax rates behave over time in a manner quite consistent with the behavior of other broad measures of federal tax policy the postwar movement in the tax rate on income from labor relative to that on income from capital or more accurately the relevant components of these tax rates provides suggestive support for the miller scholes hypothesis that the federal personal income tax has been moving in the direction of a pure consumption tax the tax rates reported in the chapter are consistent with other studies that show a decrease since the 1950s in rates of taxation at the corporate level of income from corporate held capital they are also consistent with the view that rates of taxation of such income at the noncorporate level have risen but not quite sufficiently to offset the decline in the corporate tax burden

how much damage will climate change do recent estimates two reasons to be concerned about climate change are its unjust distributional impact and its negative aggregate effect on economic growth and welfare although our knowledge of the impact of climate change is incomplete and uncertain economic valuation is difficult and controversial and the effect of other developments on the impacts of climate change is largely speculative the authors find that poorer countries and people are more vulnerable than are richer countries and people a modest global warming is likely to have a net negative effect on poor countries in hot climates but may have a net positive effect on rich countries in temperate climates if one counts dollars the world aggregate may be positive if one counts people the world aggregate is probably negative negative impacts would become more negative and positive impacts would turn negative for more substantial warming the marginal costs of carbon dioxide emissions are uncertain and sensitive to assumptions that partially reflect ethical positions but are unlikely to be larger than 50 per tonne carbon

modelling long run scenarios this paper intends to draw overall lessons from a long term study on co2 emission in france a country with a rather low energy gdp ration and in which transition to non fossil based production of electricity has been achieved more generally it points out the importance of possible bifurcation effects and draws methodological and policy implications from these statements it discusses modelling approaches to the linkages between energy and the rest of economy and addresses the issue of difficulties in cost assessment analysis in the presence of several baseline scenarios finally it proposes a more encompassing definition of no regrets policies

from shadow to green linking environmental fiscal reforms and the informal economy in the past few decades many papers have analysed in some depth different environmental tax reforms and the double dividend hypothesis i e the possibility of improving not only the environment but also the economy through the reduction of distortions in the tax system recently more stress has been placed on testing empirically what effects a reduction in labour taxes may have on unemployment when accompanied by a carbon or other environmental tax however such studies have not modelled the effects of the presence of a shadow economy even though informal markets account for a significant and growing part of gdp in many developed economies this paper analyses this link using an applied general equilibrium model for the case of spain which has one of the highest unemployment rates in the world and one of the biggest informal economies of any wealthy country we conclude that our analysis strengthens the case for an environmental tax reform in spain if revenues from a co2 tax are recycled via a labour tax reduction

linking permit markets multilaterally we formally study the determinants magnitude and distribution of efficiency gains generated in multilateral linkages between permit markets we provide two novel decomposition results for these gains characterize individual preferences over linking groups and show that our results are largely unaltered with strategic domestic emissions cap selection or when banking and borrowing are allowed using the paris agreement pledges and power sector emissions data of five countries which all use or considered using both emissions trading and linking we quantify the efficiency gains we find that the computed gains can be sizable and are split roughly equally between effort and risk sharing

an overview of experimental u s consumer price indexes the consumer price index cpi has come under intense scrutiny in recent years to help assess potential differences between what the cpi measures and how it is used for various purposes the bureau of labor statistics has created a series of experimental price indexes this article contrasts how the cpi is currently constructed with those experimental indexes specifically experimental cpps have been constructed for two population groups older americans and poor americans in addition experimental geometric mean and superlative indexes have been developed that move the cpi away from its traditional fixed market basket concept

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

green growth and the efficient use of natural resources abstract the relatively new concept of green growth can be fruitfully connected to concepts and theories in neoclassical economics including market externalities ricardian and hotelling rents and policies that would correct externalities such as pigovian taxes or a cap and trade system set to achieve emissions reductions consistent with cost benefit assessment partial equilibrium concepts have been extended to general equilibrium models including their realization in relatively detailed empirical models that faithfully adhere to theoretical concepts of neoclassical economics with such models we are then able to see how resource depletion and environmental degradation are affecting the economy and how efforts to reduce the impact of these environmental and resource constraints could improve economic growth and performance the foundation for traditional computable general equilibrium models are the national income and product accounts nipas input output i o tables and expanded social accounting matrices sams the basis for extending these to include environmental and resource assets and goods are so called integrated economic and environmental social accounts ieesas while environmental effects are often considered to be non market many of the impacts of environment are often reflected in market accounts through damages that might include for example less labor due to environment related health problems reduced productivity of agroecosystems or damage to infrastructure and other produced assets the challenge is to make the environmental connection explicit so as to provide a guide to where changes in policies could provide benefit however some damages do not enter the accounts at all and mainly this is because household labor and leisure time are generally not valued in traditional accounts hence the cost of illness in terms of reduced ability to contribute to household activities would be missed in the standard accounts while the theoretical structure for expanding the accounts has been laid out in various reviews the empirical challenge of doing so is substantial careful attention to expanding nipa accounts making it a regular part of government statistical agencies efforts would improve the foundation for analysis of potential green growth policies and measures

tax distortions and global climate policy abstract we consider the efficiency implications of policies to reduce global carbon emissions in a world with pre existing tax distortions we first note that the weak double dividend the proposition that the welfare improvement from a tax reform where environmental taxes are used to lower distorting taxes must be greater than the welfare improvement from a reform where the environmental taxes are returned in a lump sum fashion need not hold in a world with multiple distortions we then present a large scale computable general equilibrium model of the world economy with distortionary taxation we use this model to evaluate a number of policies to reduce carbon emissions we find that the weak double dividend is not obtained in a number of european countries results also demonstrate the point that the interplay between carbon policies and pre existing taxes can differ markedly across countries thus one must be cautious in extrapolating the results from a country specific analysis to other countries

fiscal interactions and the case for carbon taxes over grandfathered carbon permits this paper provides simple formulas for adjusting the costs of carbon taxes and tradable carbon permits to account for interactions with pre existing tax distortions in the labour market both policies reduce labour supply as they increase product prices and reduce real household wages the resulting efficiency losses in the labour market can be substantial relative to partial equilibrium abatement costs however much of this added cost can be offset and perhaps more than offset when additional distortions from the tax system are considered if revenues from carbon taxes or auctioned permits are used to reduce distortionary taxes consequently there can be a strong case on efficiency grounds for using carbon taxes or auctioned permits over grandfathered carbon permits copyright 2003 oxford university press

fiscal consolidation and climate policy an overlapping generations perspective abstract this paper examines the distributional and efficiency impacts of public debt consolidation financed through a carbon tax employing a dynamic general equilibrium model with overlapping generations of the u s economy the numerical model features government taxes and spending and a multi sectoral production structure including intermediate production specific detail on the energy sector both in terms of primary energy carriers and energy intensive industries and sector and fuel specific carbon inputs in contrast to revenue neutral carbon tax swaps using the carbon revenue for deficit reduction implies a relaxation of future public budgets as debt repayment results in lower future interest obligations while intergenerational welfare impacts depend importantly on what tax recycling instrument is used we find that combining public debt consolidation with a carbon policy entails the possibility of sustained welfare gains for future generations if social discount rates are sufficiently low or if social preferences exhibit a large aversion with respect to intergenerational inequality combining fiscal consolidation and climate policy may offer the chance for societal gains even without considering potential benefits from averted climate change

mergers and the importance of fitting well abstract this paper highlights the importance of partners fitting well for a stable merger to arise if all firms fit perfectly no stable merger can be performed on the contrary if not all firms are compatible a stable merger may arise

intra and extra union flexibility in meeting the european union s emission reduction targets the eu has proposed four flexibility mechanisms for the regulation of greenhouse gas emissions in the period 2013 2020 1 the emissions trade scheme ets a permit market between selected companies 2 trade in non ets allotments between member states 3 the clean development mechanism cdm to purchase offsets in developing countries and 4 trade in cdm warrants between member states this paper shows that aggregate abatement costs fall as flexibility increases however limited flexibility creates rents so that increasing flexibility raises costs in some member states costs are reduced more by the cdm than by non ets trade the cdm warrants market reduces costs by a small amount only market power is a real issue however the warrants market is obsolete in case there is non ets trade the cdm leads to price convergence between the ets and non ets market there would be one price for carbon in the european union if the proposed limits on cdm access are relaxed slightly

can a carbon permit system reduce spanish unemployment this paper analyses the impact of carbon policy on unemployment in spain and whether recycling the public revenues earned from permit auctions can alleviate this problem while spain s deviation from the european union s intermediate emission goals is more serious than most other member countries unemployment in spain is also well above average for the european union we use a computable general equilibrium model that includes unemployment in the markets for unskilled and skilled labour we find that introducing carbon permits does not aggravate spanish unemployment in fact if supplied with revenue recycling schemes unemployment rates may actually fall contrary to other european studies we find that the best option is to reduce payroll taxes on relatively skilled types of labour this reform is successful in both increasing labour demand and dampening the supply response to rising wages however while all of the recycling schemes generate dividends in terms of aggregate welfare none entirely offsets the abatement costs

growth and employment the scope of a european initiative this paper is an abridged version of a policy initiative paper prepared with a dozen colleagues in louvain la neuve and paris we propose a set of policies to cope with europe s persistent unemployment including two medium term programs a drastic reduction of the indirect cost of unskilled labour and an ambitious stimulation of targeted investments the bottom line is that policies addressing meaninfully europe s unemployment problem must be pursued on a bolder scale than currently contemplated

multifirm unions and the incentive to adopt pattern bargaining in oligopoly abstract this paper develops a model of wage bargaining between an industry wide trade union and firms in an oligopoly and considers the circumstances under which the union prefers pattern bargaining that is negotiating contracts in a sequential manner to simultaneous bargaining with the firms the paper goes on to consider the importance of the bargaining order in pattern bargaining when the firms are asymmetric the analysis shows that the union gains by first targeting a firm which is in a relatively weak bargaining position i e impatient to settle or a firm with relatively large profits

does china s carbon emission trading policy have an employment double dividend and a porter effect abstract the implementation of china s carbon emission trading policy has targeted achieving emission reduction and environmental protection as well as promoting economic development and technological innovation the analysis is made through applying the difference in differences model and using the ordinary least squares method and the least square dummy variable method in the paper results show that the pilot carbon emission trading policy leads to the expansion of employment scales and the reduction of carbon emissions after controlling for the environmental regulation population size economic level and other important variables thus it implies that an employment double dividend exists for the porter effect it is found in the pilot carbon emission trading policy only without adding any control variable the effect is further verified based on a robustness checks and a placebo test furthermore from the perspective of market oriented environmental regulation policy this study explains that the carbon emission trading system launched in 2017 needs to be improved to spread both the employment double dividend and the porter effect to the whole nation china also needs to form a complete set of strict ecological environment protection policies and administrative measures to achieve sustainable development of the economy

environmental taxation and unemployment some evidence on the double dividend hypothesis in europe abstract the employment double dividend hypothesis suggests that an appropriately designed fiscal reform in which emission charges are used to subsidize employers social security contributions may realize at least two relevant policy goals a better quality of the environment and at the same time an increase in employment levels this paper uses a newly developed econometric general equilibrium model for the european union as well as for each member country and presents simulation results up to the year 2010 of the effects of a european carbon tax the revenues from which are recycled to reduce employers social security contributions the results show that recycling carbon tax revenues may provide an employment double dividend only in the short run

environmental policy public finance and the labour market in a second best world abstract environmental and tax policies and the optimal provision of clean and dirty public goods are analysed within the context of a second best framework of optimal taxation households consume both clean and dirty commodities degradation of the natural environment occurs due to the consumption of dirty private and public goods but can be offset when the government engages in abatement activities increased environmental concern implies a higher dirt tax a lower tax on labour less employment more public abatement and a cleaner environment if the elasticity of substitution between private consumption commodities and leisure is large and that between clean and dirty goods is small public consumption may expand while private consumption contracts otherwise public consumption falls

paying the piper and calling the tune a meta regression analysis of the double dividend hypothesis abstract we present a meta regression analysis of model based simulation studies assessing the employment effects of environmental tax reforms besides the role of central modeling assumptions we investigate the implications of contracting bodies on the simulation results our analysis reveals the importance of unobservable study characteristics for the prospects of a double dividend in terms of lower emissions along with higher employment levels while at first glance labor market assumptions and the contracting body seem to play a central role for the model outcome these observable features are no longer significant when unobservable study features are controlled for in contrast we find the simulated employment impacts of environmental tax reforms to be determined by a joint set of explicit model assumptions as well as implicit characteristics of the respective studies

does climate policy make the eu economy more resilient to oil price rises a cge analysis abstract the european union has committed itself to reduce greenhouse gas ghg emissions by 20 in 2020 compared with 1990 levels this paper investigates whether this policy has an additional benefit in terms of economic resilience by protecting the eu from the macroeconomic consequences due to an oil price rise we use the gem e3 computable general equilibrium model to analyse the results of three scenarios the first one refers to the impact of an increase in the oil price the second scenario analyses the european climate policy and the third scenario analyses the oil price rise when the european climate policy is implemented unilateral eu climate policy implies a cost on the eu of around 1 0 of gdp an oil price rise in the presence of eu climate policy does imply an additional cost on the eu of 1 5 of gdp making a total loss of 2 5 of gdp but this is less than the 2 2 of gdp that the eu would lose from the oil price rise in the absence of climate policy this is evidence that even unilateral climate policy does offer some economic protection for the eu

a comparability analysis of global burden sharing ghg reduction scenarios the distribution of the mitigation burden across countries is a key issue regarding the post 2012 global climate policies this article explores the economic implications of alternative allocation rules an assessment made in the run up to the cop15 in copenhagen december 2009 we analyse the comparability of the allocations across countries based on four single indicators gdp per capita ghg emissions per gdp ghg emission trends in the recent past and population growth the multi sectoral computable general equilibrium model of the global economy gem e3 is used for that purpose further the article also compares a perfect carbon market without transaction costs with the case of a gradually developing carbon market i e a carbon market with gradually diminishing transaction costs

on the design of optimal grandfathering schemes for emission allowances to meet its commitment under the kyoto protocol the eu plans to implement an emissions trading system whith grandfathering of allowances besides having distributional impacts the choice of the grandfathering scheme may affect efficiency if firms anticipate how future allocations depend on upcoming decisions in this paper we determine central design rules for optimal grandfathering within a simple two period model we find that for small open trading systems where allowance prices are exogenous first best second period grandfathering schemes must not depend on firm specific decisions in the first period second best schemes correspond to a ramsey rule of optimal tax differentiation and are generally based on both previous emissions and output however ofr closed emissions trading systems i e endogeneous allowance prices firstand second best rules coincide and must not depend on previous output levels they consist of an assignment proportional to the emissions in the first period plus a term which does not depend on firm specific decisions in either of the two periods

effects of carbon taxes in an economy with prior tax distortions an intertemporal general equilibrium analysis abstract this paper analyzes the costs of carbon taxes in a model that recognizes interactions between this tax and pre existing taxes first we examine the extent to which costs of a u s carbon tax are reduced when its revenues finance cuts in income taxes such use of revenues significantly reduces but does not eliminate the overall policy costs the positive overall costs reflect the carbon tax s focus on intermediate inputs and its relatively narrow base in comparison with income taxes we also examine the sensitivity of the carbon tax s costs to the level of pre existing taxes for any given use of revenues welfare costs rise significantly with pre existing tax rates indicating that models disregarding pre existing taxes may substantially understate the costs of new environmental tax initiatives

quasi fixed inputs in u s and japanese manufacturing a generalized leontief restricted cost function approach in this paper a generalized leontief variable cost function is develope d which permits analytical derivation of steady state levels of quasi fixed inputs and capacity output and does not require specification of a numeraire input this framework is then used to evaluate the fa ctor demand patterns of japanese and u s manufacturing based on bot h one quasi fixed capital input and two quasi fixed capital and la bor input specifications and both static and dynamic optimization t he findings provide evidence of considerable flexibility of demand re sponses in japan which may have contributed to japan s relatively st rong economic performance in the volatile 1970s copyright 1988 by mit press

the limits of monopolization through acquisition we address the question of whether competitive acquisition of firms by their rivals can result in complete or partial monopolization of a homogeneous product industry this question is modeled in terms of two distinct three stage noncoopera tive games analysis of subgame perfect pure strategy nash equilibria of these games discloses that under simplifying assumptions monopolization of an industry through acquisition is limited to industries with relatively few firms partial monopolization is either limited in scope or can be completely eliminated by prohibiting any owner from acquiring over 50 percent of the firms in the industry

recycling energy taxes impacts on a disaggregated labour market abstract this paper analyses the impacts of energy taxes whose revenue is recycled to reduce gross wages and increase employment the main novel feature of this paper is the attempt to assess the effectiveness of this fiscal reform by using a labour market model in which both skilled and unskilled workers are used in the production process this segmentation enables us to compare a policy which aims at reducing unskilled workers wages as in the original delors white book with a policy in which the environmental fiscal revenue is used to reduce the gross wage of all workers moreover two policy scenarios will be considered a non co operative one in which each country determines the optimal domestic energy tax to achieve a given employment target and a co operative one in which the energy taxes are harmonised to equalise marginal abatement costs in the eu and in which the employment target is set for the eu our results show that i an employment double dividend can be achieved in the short run only even if a trade off between environment and employment always exists ii the effect on employment is larger when the fiscal revenue is recycled into all workers gross wages rather than into unskilled workers only iii a co operative policy leads to even larger benefits in terms of employment provided that an adequate redistribution of fiscal revenues is adopted by eu countries

economic impact of ethanol promotion in mexico a general equilibrium analysis abstract in this paper we analyze the economic impact of a decision to produce ethanol in mexico comparing the effect of a subsidy to initiate ethanol production with that of alternative public policies public support of biofuels has been a public policy goal since 2008 and the promotion of ethanol remains an active part of the government agenda the evidence used to encourage or alter the policy is by necessity chiefly based on international experience in this study we use a computable general equilibrium model cge to estimate the impact of ethanol production on the mexican economy using cost data from brazil we introduce ethanol into a mexican social accounting matrix and insert a latent sector into the model to analyze ethanol promotion our results show that subsidies to ethanol would increase agriculture production but at the expense of aggregate welfare by contrast alternative clean energy policies appear to advance economic growth to a greater extent

on the marginal welfare cost of taxation this paper develops a rigorous partial equilibrium analysis of the determinants of margin al welfare cost mwc of taxes on labor earnings it shows that four key parameters interact to determine the magnitude of mwc using aggregate data and plausible ranges of values for the parameters mwc can vary from under 10 percent to more than 300 percent of marginal tax revenue intermediate parameter values sugge st mwc is in the 25 50 percent range however the more extreme estimates cannot be ruled out on the basis of available evidence suggesting that mwc cannot yet be copyright 1987 by american economic association

effective tax rates in macroeconomics cross country estimates of tax rates on factor incomes and consumption abstract this paper proposes a method for computing tax rates using national accounts and revenue statistics using this method we construct time series of tax rates for large industrial countries the method identifies the revenue raised by different taxes at the general government level and defines aggregate measures of the corresponding tax bases this method yields estimates of effective tax rates on factor incomes and consumption consistent with the tax distortions faced by a representative agent in a general equilibrium framework these tax rates compare favorably with existing estimates of marginal tax rates and highlight important international differences in tax policy

environmental policy and double dividend in a transitional economy abstract although the environmental benefit from implementing a climate tax is usually realized the economic dividend still remains a controversial issue warranting further research this is because the impact of an environmental policy on an economy wide system will depend on factors that differ from one region to the next in this paper we develop a static cge model for liberia that is capable of analyzing both a uniform and a partial carbon tax policy under the uniform policy instituted to ensure mitigation in the range of 20 50 an economic dividend is found for energy employment and welfare in particular energy consumption increases by between 5 and 15 5 respectively interestingly under a second best policy which exempts economically strategic sectors from the tax no economic dividend is found for all three variables this time energy use declines by between 2 and 9 these suggest that a uniform environmental tax policy is a more viable option for liberia in particular as it does not only generate economic dividend for employment and welfare it also incentivizes liberia s adoption and use of renewable energy technologies in general based on the results obtained further conditions for the feasibility of a double dividend are proposed

economic growth international competitiveness and environmental protection r d and innovation strategies with the warm model abstract it is often argued that policies designed to protect the environment may harm economic growth moreover if introduced unilaterally by a given country they may reduce the competitiveness of domestic firms these arguments are generally based on the assumption that environmental protection has to be achieved through the introduction of emission charges e g a carbon tax however three issues need to be raised first the tax is not the only policy instrument and is not the most efficient one that can be used to reduce polluting emissions secondly even when a tax policy is implemented it is important to assess the feedback effects induced by recycling the tax revenue thirdly and most importantly the role of technical progress cannot be neglected therefore there may exist a policy mix that provides firms with the correct incentives to adopt energy saving technologies and to invest in environment friendly r d the first two issues have partly been explored both in the theoretical and empirical literature the third issue i e the role of incentives to technical progress still lacks adequate quantitative assessment this is why a new model has been developed which endogenizes technical progress and its effects and feedbacks on economic energy and environmental variables using warm an econometric general equilibrium model for the european union and for each member country this paper presents simulation results up to 2015 of the effects of some industrial environmental policies which are aimed at protecting the environment without necessarily damaging competitiveness and economic growth the results show that policies that stimulate environmental r d technological innovation and diffusion may provide firms with the correct incentives to avoid damaging the environment while preserving their competitiveness in the market moreover such a policy based both on r d subsidies and on innovation incentives may not worsen the public sector budget balance as a result of the positive effects on economic growth

autonomous efficiency improvement or income elasticity of energy demand does it matter observations of historical energy consumption energy prices and income growth in industrial economies exhibit a trend in improving energy efficiency even when prices are constant or falling two alternative explanations of this phenomenon are a productivity change that uses less energy and a structural change in the economy in response to rising income it is not possible to distinguish among these from aggregate data and economic energy models for forecasting emissions simulate one as an exogenous time trend or the other as energy demand elasticity with respect to income or both processes for projecting energy demand into the future in this paper we ask whether and how it matters which process one uses for projecting energy demand and carbon emissions we compare two versions of the mit emissions prediction and policy analysis eppa model one using a conventional efficiency time trend approach and the other using an income elasticity approach we demonstrate that while these two versions yield equivalent projections in the near term that they diverge in two important ways long run projections and under uncertainty in future productivity growth we suggest that an income dependent approach may be preferable to the exogenous approach

real wage determination and labour market policies the swedish experience it is a common view that labor market programs reduce unemployment and restrain wages by increasing the competition for jobs the swedish case is often advanced as a blueprint to follow this article questions the conventional wisdom on the swedish labor market policies it finds empirical evidence in favor of the hypothesis that job creation and training programs weaken the incentives for wage restraint as a consequence it appears likely that labor market programs have strong crowding out effects on regular employment copyright 1991 by royal economic society

rising inequality changes in the distribution of income and consumption in the 1980s this paper examines changes in the distribution of income and consumption in the united states during the 1980s using data from the current population survey income and consumer expenditure survey consumption we reach three primary conclusions first changes in the distribution of consumption parallel changes in the distribution of income the lowest quintile of the consumption distribution received 0 9 percentage points less of total consumption in 1988 than in 1980 the corresponding decline for income was 0 6 percentage points second broad conclusions concerning recent changes in the consumption distribution are not very sensitive to the exact choice of a measure of family needs under a wide variety of alternative household equivalence scales there is a widening in the consumption distribution in the 1980s third the usc of consumption measures of well being in place of measures based on current money income docs change conclusions concerning the extent of poverty in the united stales using the official federal poverty thresholds we find that the overall consumption poverty rate was three percentage points below the income poverty rate in 1988 comparisons of the poverty rates of the elderly and the non elderly are substantially affected by the choice of poverty measure the consumption poverty rare for the elderly was only 60 percent of the rate for adults and one third of the rate for children in 1988 this abstract was borrowed from another version of this item

double dividend with involuntary unemployment efficiency and intergenerational equity this paper analyzes the double dividend and distributional issues within an overlapping generations model framework with involuntary unemployment we characterize the necessary conditions needed to obtain a double dividend when the revenue of the environmental tax is recycled by a variation of the labor tax rate we show that an employment dividend may occur without any efficiency dividend and that the young generation is not always harmed by the fiscal reform even without any intergenerational transfers therefore three dividends environmental efficiency and intergenerational equity can occur simultaneously

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

carbon taxation in russia prospects for a double dividend and improved energy efficiency russia is not only one of the world s major sources of carbon based energy coal oil and gas but is also one the most intensive users of energy furthermore russia accounts for a disproportionately large share of global carbon dioxide emissions some 5 to 6 of global carbon dioxide emissions eia 2011a it has been estimated world bank 2008 that russia could reduce its use of primary energy use by 45 with consequent economic and environmental benefits high energy and carbon intensity of the russia economy is inter alia explained by low energy prices due to high export taxes as well as administrative regulation of domestic prices of gas and electricity and low environmental taxes carbon taxes are one such pigouvian tax and they would address concerns on several fronts simultaneously in the short to medium term they would inter alia lead to lower ghg emissions and encourage the diffusion of more energy efficient technologies in the longer term the increased cost of energy inputs is expected to induce technological progress in this analysis the macroeconomic and sectoral effects of carbon taxes on the russia economy are examined this analysis addresses the following objectives i to test the double dividend hypothesis under perfect and imperfect competition in output markets to analyse ii the incidence of carbon taxes iii impacts on sectoral competitiveness iv effects on income equity and v interactions of carbon taxes with other taxes a computable single country multi sector comparative static cge model is employed russland verfugt nicht nur uber einen der grosten vorrate an kohlenstoffbasierter energie wie kohle rohol und gas sondern ist auch einer der grosten energieverbraucher daruber hinaus ist russland fur einen uberproportional grosen anteil von kohlendioxid emission etwa 5 bis 6 der weltweiten kohlendioxidemission verantwortlich mit der einfuhrung einer kohlendioxidsteuer konnten gleichzeitig unterschiedliche wirkungen erzielt werden kurz und mittelfristig wurden kohlenstoffsteuern sowohl zu einer reduzierung von treibhausgasemissionen als auch zur einfuhrung von energieeffizienteren technologien fuhren langfristig wird erwartet dass hohe energiekosten den anreiz zur entwicklung und zur investition in energiesparenden technischen fortschritt erhohen die vorliegende arbeit analysiert und bewertet die makrookonomischen und sektoralen auswirkungen einer einfuhrung von kohlenstoffsteuern auf die russische wirtschaft die ziele der arbeit bestehen darin die hypothese der doppelten dividende fur den fall des vollkommenen und des unvollkommenen wettbewerbs auf gutermarkten zu uberprufen und die inzidenz einer kohlenstoffsteuer ihre auswirkungen auf die sektorale wettbewerbsfahigkeit ihre auswirkungen auf die einkommensverteilung und die interaktion von kohlenstoffsteuern mit anderen steuern zu analysieren und zu bewerten als methodischer ansatz wurde ein single country und multi sektor model gewahlt

pollution taxes and revenue recycling abstract discussions of environmental policy and the tax system have emphasized the value of pollution tax revenues which can be used to reduce other tax distortions in the economy however by raising private marginal production costs environmental taxes also tend to reduce gdp and exacerbate the welfare costs of conventional taxes for environmental taxes in consumption goods industries the net welfare change from these two effects is negative unless this good is a relatively weak substitute for leisure an estimate for the optimal pollution tax with full revenue recycling is 63 to 78 of marginal environmental damages

carbon markets and technological innovation this paper examines the effects of firm level innovation in carbon abatement technologies on optimal cap and trade schemes with and without price controls we characterize optimal cap and trade regulation with a price cap and a price floor and compare it to the special cases of pure taxation and a simple emissions cap innovation shifts the tradeoff between price and quantity based instruments towards quantitybased emissions trading schemes more specifically an increase in innovation effectiveness lowers the optimal emissions cap and leads to relaxed price controls unless the slope of the marginal environmental damage curve is small because of the decrease in the emissions cap innovation in abatement technologies can lead to a higher expected carbon price so as to provide sufficient incentives for private r d investments the expected carbon price decreases once innovative technologies are widely used

application of computable general equilibrium cge to climate change mitigation policy a systematic review abstract with the growing literature related to climate change mitigation measures and policy interventions a systematic review of the application of computable general equilibrium cge model is inevitable therefore this article aims to characterise the relevant studies define a comparative framework to identify the current state of the art and the gaps in applied general equilibrium models firstly the systematic review found a total of 301 research articles from scopus and web of science databases and finally analysed 154 articles based on inclusion and exclusion criteria from 67 refereed journals the review analysis found that application of cge model is very vital in addressing climate change mitigation issues at the national regional and global levels however china attracted the most substantial research interests followed by the usa india and australia among others which are in line with their share of greenhouse gas emissions in the world most of the research themes focus on the carbon tax emission reduction target emission trading renewable energy energy efficiency and carbon capture and storage as primary drivers of low carbon economy nevertheless there is a trend of employing more static cge model compared to the dynamic cge although application of the latter has a limitation of providing right inputs to the macroeconomic policy finally research directions and gaps envision other complementary models such as dynamic stochastic general equilibrium dsge and agent based model abm for proper policy interventions

economic analysis of the climate pledges of the copenhagen accord for the eu and other major countries abstract this article uses the world gem e3 computable general equilibrium model to assess the economic consequences of the climate copenhagen accord the model allows analyzing the macroeconomic costs in terms of gdp the change in employment as well as the impacts on production of specific energy intensive sectors various 2020 climate scenarios are evaluated depending on the ghg mitigation pledges we find that the cost for the developed countries is around 0 5 of gdp in 2020 for the more ambitious pledges whereas the gdp effects are more heterogeneous across developing countries and russia reflecting the different pledges and the assumptions in the reference scenario across these countries further the article explores whether there is a form of double dividend in the eu when the revenues from auctioning or taxation of ghg emissions are used to reduce the social security contributions of employees we conclude that gdp and employment perform better compared to the free allocation of permits when more sectors are subject to auctioning or ghg taxes and the additional government revenues are used to reduce the cost of labour

economic energy and greenhouse emissions impacts of some consumer choice technology and government outlay options abstract the impacts of selected spending options in the australian economy are determined in terms of energy consumption greenhouse gas emissions and a range of economic parameters six case studies of one current practice and one alternative environmentally motivated spending option are carried out describing consumer choices technologies and government outlays the assessment method is based on input output theory and as such enables both the direct and indirect effects of spending to be quantified in general the results indicate that pro environmental objectives such as reductions in energy consumption and greenhouse gas emissions are compatible with broad socio economic benefits such as increases in employment and income and reductions in imports

average marginal tax rates from social security and the individual income tax we extend previous estimates of the average marginal tax rate from the federal individual income tax to include social security our computations consider the tax rates on employers employees and the self employed the income that accrues to persons with earnings below the ceiling and the effective deductibility of employers social security contributions from workers taxable income the next effect of social security on the average marginal tax rate is below 02 until 1966 but then rises to 03 in 1968 04 in 1973 05 in 1974 06 in 1979 and 07 in 1982 this abstract was borrowed from another version of this item

brown backstops versus the green paradox abstract anticipated climate policies are ineffective when fossil fuel owners respond by shifting supply intertemporally the green paradox this mechanism relies crucially on the exhaustibility of fossil fuels we analyze the effect of anticipated climate policies on emissions in a simple model with two fossil fuels one scarce and dirty e g oil the other abundant and dirtier e g coal we derive conditions for a green orthodox anticipated climate policies may reduce current emissions the model can also be used to analyze spatial carbon leakage calibrations suggest that intertemporal carbon leakage from 0 to 8 is a relatively minor concern

public acceptability of personal carbon trading and carbon tax abstract climate change is one of the greatest challenges confronting the international community requiring action to achieve deep cuts in carbon emissions the implementation of potentially uncomfortable but necessary policy measures is though critically dependent upon public acceptability this paper reports a novel application of stated preference techniques to explore the influence of key design attributes on the acceptability of a personal carbon trading scheme in isolation and when compared to a carbon tax illustrative forecasts from the models developed indicate the importance of design attributes especially the basis of the initial permit allocation for personal carbon trading and the use to which revenues are put for carbon tax results indicate that the best scheme designs could be acceptable to a majority of respondents

environmental levies and distortionary taxation pigou taxation and pollution i note an important distinction between the optimal price of environmental quality in a second best world and the optimal level of environmental quality using an analytical general equilibrium model i show that for reasonable parameter values an increase in tax distortions arising from an increase in required tax revenues leads to a fall in the optimal pigouvian tax rate even while environmental quality improves in general knowledge of the direction of changes in optimal environmental tax rates due to changes in the economy is not sufficient for understanding the impact on environmental quality 2003 elsevier science b v all rights reserved

union s threats and wage determination this paper considers local wage bargaining as a sequential game and focus es on how different rules of the game affect employment and equilibri um payment to workers and employers work to rule and other go slow t hreats lead to low employment while strike threats lead to high empl oyment an increase in the bargaining power of the union induces high er or unchanged equilibrium employment in the strike threat case whi le employment is reduced in the slow down case finally if all kinds of industrial actions are legal only one is credible which type de pends on the parameters of the model copyright 1988 by royal economic society

endogenous formation of coalitions the formation of coalitions is a fundamental problem in game theory by a coalition is meant a group of players e g economic or political agents which decide to act together as one unit relative to the rest of the players this includes the instances of syndicates unions cartels blocks political parties parliamentary coalitions etc we would like to emphasize that forming a coalition does not eliminate the individual players as decision makers in all interactions with the other players coalition members act as one unit it may be useful to think of a representative agent taking their place 2 however this arrangement will continue only as long as each player finds it desirable to act this way further bargaining occurs among the members of each coalition on how to divide what they obtained together thus the existence of coalitions implies that the interactions among the players will be conducted on two levels first among the coalitions and second within each coalition most of the existing models in economics and game theory assume that the coalition structure is given exogenously instead we try here to obtain it as an endogenous outcome of our model namely we want to be able to predict which coalitions will in fact form in each given situation 3 our theory combines two kinds of game theoretic concepts value and stability the basic idea is first to evaluate the players prospects in the various coalition structures and then based on these values to find which ones are stable we will call this value coalition structure value or cs value for short the reason we are considering coalition structures i e partitions of the set of players into disjoint coalitions rather than just coalitions is that in general players may find it to their advantage to join forces in some situations and to act separately in others all depending on the way the other participants are organized this implies that both the value and the stability concepts should depend on the entire coalition structure the cs value we analyze in this paper was first developed by owen 7

the double dividend hypothesis in a cge model specific factors and the carbon base abstract we use a computable general equilibrium model to empirically examine the double dividend dd hypothesis using the gtap model data for australia we examine three environmental taxes on the production of energy goods following bento and jacobsen 2007 we examine the role played by specific factors in the production of energy goods our results provide support for the existence of a strong dd in australia when revenue is recycled through reductions in consumption taxes the strong dd is larger when the share of specific factors is higher and is much more pronounced when carbon taxes are charged on the production origin based accounting rather than the usage destination based accounting of carbon these results draw attention to the importance of the definition of the carbon base and have implications for the scale of carbon leakage

the kyoto protocol and developing countries abstract under the kyoto protocol the world s wealthier countries assumed binding commitments to reduce greenhouse gas emissions the agreement requires these countries to consider ways to minimize adverse effects on developing countries of these actions transmitted through trade using a general equilibrium model of the world economy we find that adverse effects fall mainly on energy exporting countries for some even greater than on countries that are assuming commitments removing existing fuel taxes and subsidies and using international permit trading would greatly reduce the adverse impacts and also reduce economic impacts on the countries taking on commitments another approach preferential tariff reduction for developing countries would benefit many developing countries but would not target those most adversely affected if instead oecd countries directly compensated developing countries for losses the required annual financial transfer would be on the order of 25 billion 1995 us in 2010

economists views about parameters values and policies survey results in labor and public economics specialists in labor economics and public economics at 40 leading research universities provided opinions of policy proposals quantitative best estimates and 95 percent confidence intervals for economic parameters and answers to values questions regarding income redistribution efficiency versus equity and individual versus social responsibility their positions on policy are more closely related to their values than to their estimates of relevant economic parameters average best estimates of the economic parameters agree well with the relevant literature but individual best estimates are usually widely dispersed the individual 95 percent confidence intervals are much narrower than the substantial cross respondent variation in estimates would warrant

optimal dynamic carbon taxes in a climate economy model with distortionary fiscal policy how should carbon be taxed as a part of fiscal policy the literature on optimal carbon pricing often abstracts from other taxes however when governments raise revenues with distortionary taxes carbon levies have fiscal impacts while they raise revenues directly they may shrink the bases of other taxes e g by decreasing employment this article theoretically characterizes and then quantifies optimal carbon taxes in a dynamic general equilibrium climate economy model with distortionary fiscal policy first this article establishes a novel theoretical relationship between the optimal taxation of carbon and of capital income this link arises because carbon emissions destroy natural capital they accumulate in the atmosphere and decrease future output consequently this article shows how the standard logic against capital income taxes extends to distortions on environmental capital investments second this article characterizes optimal climate policy in sub optimal fiscal settings where income taxes are constrained to remain at their observed levels third this article presents a detailed calibration that builds on the seminal dice approach but adds features essential for a setting with distortionary taxes such as a differentiation between climate change production impacts e g on agriculture and direct utility impacts e g on biodiversity existence value the central quantitative finding is that optimal carbon tax schedules are 8 24 lower when there are distortionary taxes compared to the setting with lump sum taxes considered in the literature

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

reflections on the double dividend debate we survey the history of carbon taxation the range of market based instruments mbis of environmental control and the state of the double dividend debate in order to suggest directions for future research into mbis returning mbi revenues as lower distortionary taxes rather than as lump sums raises aggregate welfare but we favour mbis which raise little or no revenue for reasons of political acceptability to interest groups at the same time the overall case for any environmental improvement is weaker because of general equilibrium interactions with prior distortionary taxes research seems most necessary on quantifying the efficiency benefits of market control of heterogeneous polluters the benefits of environmental improvement the tax interaction effect and the various information costs of an mbi all on a case by case basis for different pollutants and places

green policies and public finance in a small open economy we explore the effects of greener preferences for the public finances employment and the domestic capital stock in a second best framework we find that greener preferences typically result in capital flight also employment declines despite the factor substitution that is induced by a lower tax on labour and a higher tax on natural resources if the uncompensated wage elasticity of labour supply is positive private utility declines public consumption in contrast may rise if most of the improvement in environmental quality occurs through a lower level rather than a cleaner composition of economic activity however if the labour supply curve bends backwards private utility rises while public consumption falls i introduction the deterioration of the natural environment constitutes one of the major challenges facing public policy today business groups are concerned that environmental protection induces both capital flight and major losses in private income environmental groups in contrast maintain that a more ambitious environmental policy may not impose large costs in particular environmental taxation may be attractive especially for the high tax countries of western and northern europe in these countries the

household transport demand in a cge framework the main objective of this study is to improve the modelling of household demand for transport services in a computable general equilibrium cge model the new extended model is then used for numerical calculations to test how the swedish economy reacts to a carbon target special attention will be given to distributional effects and the connection between labour supply and work journeys in a sparsely populated country like sweden a differentiation between trip purposes and trip length a complementary relationship between work journeys and labour supply and a subdivision of households by density of population and income influence the numerical results our main conclusions from the analysis of a carbon target are that if the carbon tax revenue is recycled by decreasing the employers social contribution fee welfare costs are lower than with lump sum replacements of tax revenue to households the welfare cost may be reduced even further if work journeys are not additionally taxed as compared to the base year however the lower total welfare cost is obtained at the expense of making society more unequal since both labour tax recycling cuts in employers social contributions and exempting tax on work journeys will make low income groups carry a higher burden an increased carbon dioxide tax is also shown to increase welfare differences between sparsely populated areas and city regions in sweden

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

targets for global climate policy an overview a survey of the economic impact of climate change and the marginal damage costs shows that carbon dioxide emissions are a negative externality the estimated pigou tax and its growth rate are too low to justify the climate policy targets set by political leaders a lower discount rate or greater concern for the global distribution of income would justify more stringent climate policy but would imply an overhaul of other public policies catastrophic risk justifies more stringent climate policy but only to a limited extent

insider effects in wage determination abstract the paper attempts to shed new light on the determinants of industry wages by a cross country comparison of wage setting relationships making use of comprehensive and consistent panel data on industries from the early 1960s to the mid 1980s the empirical analysis involves estimations of identically specified industry wage equations for each of five countries sweden norway finland germany and the united states a key finding is that industry wages in the u s are the most responsive to sectoral price and productivity changes by contrast industry wages in the nordic countries are largely unaffected by sectoral conditions the results cast doubt on the competitive model as an accurate characterization of wage setting under decentralization

carbon taxation prices and welfare in new zealand abstract this paper examines the effects on consumer prices arising from imposing a carbon tax in new zealand using information about inter industry transactions and the use of fossil fuels by industries the welfare effects of the carbon tax are examined for a range of different household types finally overall measures of inequality are reported

environmental policy reconsidered the role of technological innovation abstract this paper discusses recent environmental policy wisdom in the light of technological and organizational innovation starting from empirical evidence it argues that the main econometric models which are used in environmental policy analysis do not consider properly the determinants and effects of innovation and offer unreliable estimates of policy effects some solutions to the latter problem show that the integration between environmental policy and industrial policy can be more efficient than traditional environmental policies in the protection of the environment technological cooperation moreover can be an important instrument to stabilize international environmental agreements

the cost of climate policy in the united states abstract we re evaluate prospects for us economic growth and the likely costs of advanced technologies given recent developments and then apply the mit emissions prediction and policy analysis eppa model to evaluate three core ghg policy scenarios for the us that cap emissions at different levels the three policy scenarios involve allowance allocations that through 2050 are 1 constant at present emissions levels 2 linearly reduced to 50 below present 3 linearly reduce emissions to 80 below present the cumulative allowance allocations over the horizon of the policy are 287 203 and 167 gt of co 2 equivalent respectively we compare the results to previous analysis of these same policy scenarios to evaluate how the changed growth and technology prospects affect the results we focus on 203 and 167 gt scenarios because current proposals envision deep cuts in emissions from present the 167 gt scenario is closest to proposals currently being considered by congress and supported by the us administration however we do not attempt to model specific details of actual proposals we test results to alternative assumptions about program coverage and banking behavior measured in terms of changes in economic welfare the economic cost of 203 and 167 gt cases is in the range of 2 to 3 by 2050 with co 2 prices between 48 and 67 in 2015 rising to between 190 and 266 by 2050 implementation details matter when an idealized economy wide cap and trade is replaced by coverage omitting some sectors or if the credibility of long term target is weak limiting banking behavior prices and welfare costs change substantially

on the construction of marginal federal personal and social security tax rates in the u s abstract in this article i correct and extend my earlier series on marginal federal personal income tax rates i also construct a measure of the marginal social security tax rate and add this to the income tax rate to obtain a measure of the effective marginal tax rate on income due to federal taxes finally i compare my series on marginal income tax rates and its method of construction with those of barro and sahasakul

gaining ground poverty in the postwar united states official measures of poverty in the united states are compiled by the bureau of the census by comparing a household s income level to a prespecified threshold from a theoretical perspective it is more appropriate to evaluate the level of poverty using a consumption based measure of household welfare in this paper i evaluate the level of poverty using expenditure data from the consumer expenditure survey i find that consumption based poverty rates are much lower than those based on income the trend in the poverty rate in the united states is sensitive to the price index and equivalence scales used to adjust the poverty thresholds

the structure of the climate debate first best climate policy is a uniform carbon tax which gradually rises over time civil servants have complicated climate policy to expand bureaucracies politicians to create rents environmentalists have exaggerated climate change to gain influence other activists have joined the climate bandwagon opponents to climate policy have attacked the weaknesses in climate research the climate debate is convoluted and polarized as a result and climate policy complex climate policy should become easier and more rational as the paris agreement has shifted climate policy back towards national governments changing political priorities austerity and a maturing bureaucracy should lead to a more constructive climate debate

alleviating unemployment the case for green tax reforms abstract it has been argued recently that imposing taxes on pollution produces additional tax revenues which can be used to replace labour taxes and thus reap a double dividend in the form of improving environmental quality and alleviating unemployment this paper analyses the employment effects of revenue neutral green tax reforms by focusing on the revenue recycling effect our model contains three features which are important when looking at the employment effects of green tax reforms first there is unemployment in equilibrium second wages are determined endogenously third various institutional arrangements for taxing unemployment benefits for the price indexation of unemployment benefits and the personal tax exemption are considered it is shown that these institutional arrangements are crucial for the effectiveness of green tax reforms a revenue neutral green tax reform will boost employment if unemployment benefits are nominally fixed and taxed at a lower rate than labour income employment actually falls if unemployment benefits are price indexed and taxed at the same rate a revenue neutral green tax reform which increases the personal tax credit will never increase employment

tax reform structural unemployment and the environment the effects of environmental tax reform i e using the proceeds of a higher energy tax rate to lower the labour tax rate on wage formation employment and environmental quality are analysed in the context of a small open economy with structural unemployment caused by hiring costs we find that such a reform may boost employment if it shifts the tax burden away from workers towards those without employment in the formal sector environmental tax reform succeeds in shifting the tax burden away from workers in the formal sector if higher energy taxes reduce earnings in the informal sector by reducing labour productivity

energy taxation as a policy instrument to reduce co2 emissions a net benefit analysis abstract this study evaluates the costs and benefits of energy taxation as a policy instrument to conserve energy and reduce co2 emissions the study combines economic cost estimates generated with a cge model and monetary estimates of environmental damages in a comprehensive cost benefit framework we find that optimal co2 emissions reductions range from 5 to 38 depending on different assumptions about energy substitution elasticities and environmental damages co2 emissions reductions of between 8 and 64 can be attained at no additional welfare cost relative to a policy of not undertaking any action to control co2 emissions

the implications of demographic specific inflation rates for trends in real educational wage differentials we use data from consumer expenditure surveys to investigate the impact on trends in real wage differentials of using group specific price indexes we find that inflation rates decrease monoton ically with the education of the household head throughout the 1970s and early 1980s and real educational wage differentials calculated using education specific price indexes widened somewhat more than nominal differentials we also find that differences by education level in fuel and energy consumption whose relative prices increased during the 1970s account for the majority of the educational index differences

co2 stabilization may be a no regrets policy restricting co2 emissions requires changing today s consumption pattern away from energy and emission intensive commodities towards cleaner goods the cost of stabilizing co2 emissions at the 1990 level by the year 2000 say as compared to a business as usual trend is estimated by several researchers to be on the order of 1 of gnp we will argue that the cost may be overestimated because of a too simple model describing the working of the economic system and the evaluation of welfare we demonstrate that by expanding a model to include the actual tax system and negative externalities the cost to present generations from restricting emissions by a co2 tax may be negative that is some reduction may actually correspond to a no regrets policy the reasons are inefficiencies in today s tax system and non optimal handling of negative externalities our analysis suggests that a co2 tax and reduced emissions will lessen such inefficiencies

consequences of environmental tax reform for involuntary unemployment and welfare we investigate the welfare effects of environmental tax reform i e raising environmental taxes and using the proceeds to reduce distortionary taxes on labour the framework of analysis is a small open economy with involuntary unemployment due to a rigid consumer wage environmental tax reform boosts not only environmental quality but also employment if substitution between labour and resources is easy the production share of the fixed factor is large and the initial tax rates on resources and profits are small if the initial tax system is sub optimal with a negligible tax on resources profits rise as well

the impacts of carbon pricing on coastal megacities a cge analysis of singapore abstract pricing carbon is a widely used policy instrument for climate change mitigation quantitative analysis of carbon pricing are mainly conducted at the regional and national level rarely at the city level due to data availability as a representative of coastal megacities that are vulnerable to both climate change and climate policies singapore has announced to impose carbon tax on large direct emitters as a complementary mitigation option to technical measures a city level computable general equilibrium cge model is developed to simulate potential impacts of carbon pricing on the city including paying border carbon adjustment bca on exports or introducing a domestic carbon tax different sector coverages and carbon tax revenue recycling schemes are investigated for domestic carbon tax the simulation results show that a domestic carbon tax is a more cost effective option than paying bca given an identical carbon price at s 10 t co 2 gdp total exports and household consumption would decline less and average abatement cost is much smaller in the carbon tax scenarios compared to the bca scenario in terms of absolute emissions reduction a carbon tax that covers energy manufacturing and land transport sectors would be preferred making emissions around 2 7 lower than 2010 baseline level