Author
Listed:
- Guilherme MAGACHO
- Antoine GODIN
- Sakir Devrim Yilmaz
- Danilo Spinola
Abstract
Inclusion of developing and emerging countries in the low carbon transition agenda is imperative to meet climate goals, and policies should be tailored to their unique characteristics. Despite their significance, the structural specifics of these countries are frequently overlooked in low-carbon transition models. In an effort to establish an appropriate framework for such analyses, this article formulates a Structural Stock Flow Consistent (Structural SFC) model designed for open developing economies. This model categorizes production into three sectors: resource based exports, non-tradable goods and services, and other tradable sectors. While SFC models play a crucial role in emphasizing financial constraints, they frequently lack a multi-sectoral viewpoint and disregard structural specificities. Our model makes a dual contribution: (1) it offers a flexible framework capable of accommodating diverse country characteristics while balancing short-term demand with long term structural strategies, and (2) it underscores the inadequacy of relying solely on carbon pricing for economies deeply rooted in carbon-intensive sectors. By incorporating structurally distinct sectors within a genuinely monetary framework, the model enables us to comprehend the decisive role played by financial constraints arising from structural rigidities in shaping the dynamics of the low-carbon transition. Our findings show that the efficacy of carbon pricing is contingent on a country’s commercial, financial, and production structure. Furthermore, the results emphasize the significance of carbon tax recycling in preventing recessions and promoting sustainable decarbonization. This is accomplished by bolstering innovation and competitiveness in low-emission industries.
Suggested Citation
Guilherme MAGACHO & Antoine GODIN & Sakir Devrim Yilmaz & Danilo Spinola, 2024.
"Recycling carbon taxes for reindustrialisation: addressing structural rigidity and financialisation in natural resource exporting countries,"
Working Paper
0789b6df-2d1e-44da-988d-a, Agence française de développement.
Handle:
RePEc:avg:wpaper:en16516
Download full text from publisher
More about this item
JEL classification:
- Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics
NEP fields
This paper has been announced in the following
NEP Reports:
Statistics
Access and download statistics
Corrections
All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:avg:wpaper:en16516. See general information about how to correct material in RePEc.
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
We have no bibliographic references for this item. You can help adding them by using this form .
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AFD (email available below). General contact details of provider: https://edirc.repec.org/data/afdgvfr.html .
Please note that corrections may take a couple of weeks to filter through
the various RePEc services.