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Climate Change Policies, World Markets and Finland - Simulation Results

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  • Haaparanta, Pertti
  • Kerkelä, Leena
  • Liski, Matti
  • Riipinen, Toni
  • Sulamaa, Pekka

Abstract

We quantify the costs of global climate change policies to Finland using a modified GTAP-E model. We calculate resource abundance profiles proposed by Leamer assuming emission rights to be new factor endowments to characterize the impact of the Kyoto agreement on the distribution of the comparative advantage and to interpret the results. We estimate economylevel and detailed sector-specific effects of climate change policies without isolating Finland from world markets: changes in trade linkages are endogenously determined by global climate change policies. We produce a range of estimates by varying the regional coverage and the way of implementation of the climate treaty. When trade linkages are explicit, standard growth scenarios imply considerably higher emissions reductions than previous estimates.

Suggested Citation

  • Haaparanta, Pertti & Kerkelä, Leena & Liski, Matti & Riipinen, Toni & Sulamaa, Pekka, 2001. "Climate Change Policies, World Markets and Finland - Simulation Results," Conference papers 330943, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:330943
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    2. Laird, Sam, 1997. "MERCOSUR: Objectives and achievements," WTO Staff Working Papers TPRD-97-02, World Trade Organization (WTO), Economic Research and Statistics Division.
    3. Hertel, Thomas, 1997. "Global Trade Analysis: Modeling and applications," GTAP Books, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, number 7685, December.
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