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Short-Term Price Effects of a Carbon Tax and Implications for Sectors Competitiveness in Small Open Economies

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  • Nicolas Gonne

Abstract

Asymmetric climate policies are expected to distort the level-playing field regarding international trade, singularly to the detriment of small open economies. The paper develops a flexible method that provides essential input regarding the design of offsetting measures. It builds on input-output analysis and standard input-output data to provide proxies for both carbon-intensity and trade-intensity. These are used to reckon the impact that such policies like carbon taxation are expected to have on international competitiveness. The method is then applied to the case of Belgium.

Suggested Citation

  • Nicolas Gonne, 2010. "Short-Term Price Effects of a Carbon Tax and Implications for Sectors Competitiveness in Small Open Economies," CESifo Working Paper Series 3257, CESifo.
  • Handle: RePEc:ces:ceswps:_3257
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp3257.pdf
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    References listed on IDEAS

    as
    1. Zhang, ZhongXiang & Baranzini, Andrea, 2004. "What do we know about carbon taxes? An inquiry into their impacts on competitiveness and distribution of income," Energy Policy, Elsevier, vol. 32(4), pages 507-518, March.
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    7. Francis Bossier & Danielle Devogelaer & Dominique Gusbin & Frédéric Verschueren, 2008. "Working Paper 21-08 - Impact of the EU Energy and Climate Package on the Belgian energy system and economy - Study commissioned by the Belgian federal and three regional authorities," Working Papers 0821, Federal Planning Bureau, Belgium.
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    More about this item

    Keywords

    carbon taxes; input-output analysis; sectors price-competitiveness;
    All these keywords.

    JEL classification:

    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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