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Effects of international climate policy for India: Evidence from a national and global CGE model

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  • Weitzel, Matthias
  • Ghosh, Joydeep
  • Peterson, Sonja
  • Pradhan, Basanta

Abstract

In order to reach the two degree target it is necessary to control CO2 emissions also in fast growing emerging economies such as India. The question is how the Indian economy would be affected by e.g. including the country into an international climate regime. Existing analyses with either a global model or a single country computable general equilibrium model miss important aspects such as distributional issues or international repercussions. By soft-linking models of these two classes, we provide a more detailed view on these issues. In particular, we analyze different options of transferring revenues from domestic carbon taxes and international transfers to different household types and how different assumptions on exchange rates affect transfer payments. We also show effects stemming from international price repercussions. Our analysis focusses on how these transmission channels affect welfare of nine different household types.

Suggested Citation

  • Weitzel, Matthias & Ghosh, Joydeep & Peterson, Sonja & Pradhan, Basanta, 2013. "Effects of international climate policy for India: Evidence from a national and global CGE model," VfS Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79771, Verein für Socialpolitik / German Economic Association.
    • Handle: RePEc:zbw:vfsc13:79771
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    References listed on IDEAS

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    1. Maurizio Bussolo & David O’Connor, 2001. "Clearing the Air in India: The Economics of Climate Policy with Ancillary Benefits," OECD Development Centre Working Papers 182, OECD Publishing.
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    8. Johansson, Daniel J. A. & Lucas, Paul L. & Weitzel, Matthias & Ahlgren, Erik O. & Bazaz, A. B. & Chen, Wenying & den Elzen, Michel G. J. & Ghosh, Joydeep & Grahn, Maria & Liang, Qiao-Mei & Peterson, S, 2012. "Multi-model analyses of the economic and energy implications for China and India in a post-Kyoto climate regime," Kiel Working Papers 1808, Kiel Institute for the World Economy (IfW Kiel).
    9. van Ruijven, Bas J. & Weitzel, Matthias & den Elzen, Michel G.J. & Hof, Andries F. & van Vuuren, Detlef P. & Peterson, Sonja & Narita, Daiju, 2012. "Emission allowances and mitigation costs of China and India resulting from different effort-sharing approaches," Energy Policy, Elsevier, vol. 46(C), pages 116-134.
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    Cited by:

    1. Pradhan, Basanta K. & Ghosh, Joydeep, 2021. "COVID-19 and the Paris Agreement target: A CGE analysis of alternative economic recovery scenarios for India," Energy Economics, Elsevier, vol. 103(C).
    2. Julien Lefevre, 2018. "Modeling the Socioeconomic Impacts of the Adoption of a Carbon Pricing Instrument – Literature review," CIRED Working Papers hal-03128619, HAL.
    3. Gupta, Dipti & Ghersi, Frédéric & Vishwanathan, Saritha S. & Garg, Amit, 2019. "Achieving sustainable development in India along low carbon pathways: Macroeconomic assessment," World Development, Elsevier, vol. 123(C), pages 1-1.
    4. Daniel Johansson & Paul Lucas & Matthias Weitzel & Erik Ahlgren & A. Bazaz & Wenying Chen & Michel Elzen & Joydeep Ghosh & Maria Grahn & Qiao-Mei Liang & Sonja Peterson & Basanta Pradhan & Bas Ruijven, 2015. "Multi-model comparison of the economic and energy implications for China and India in an international climate regime," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 20(8), pages 1335-1359, December.
    5. Pradhan, Basanta K. & Ghosh, Joydeep, 2019. "Climate policy vs. agricultural productivity shocks in a dynamic computable general equilibrium (CGE) modeling framework: The case of a developing economy," Economic Modelling, Elsevier, vol. 77(C), pages 55-69.
    6. Pradhan, Basanta K. & Ghosh, Joydeep & Yao, Yun-Fei & Liang, Qiao-Mei, 2017. "Carbon pricing and terms of trade effects for China and India: A general equilibrium analysis," Economic Modelling, Elsevier, vol. 63(C), pages 60-74.
    7. Leimbach, Marian & Hübler, Michael & Mahlkow, Hendrik & Montrone, Lorenzo & Bukin, Eduard & Felbermayr, Gabriel & Kalkuhl, Matthias & Koch, Johannes & Marcolino, Marcos & Pothen, Frank & Steckel, Jan , 2024. "Macroeconomic structural change likely increases inequality in India more than climate policy," Open Access Publications from Kiel Institute for the World Economy 302045, Kiel Institute for the World Economy (IfW Kiel).
    8. Charlotte Senkpiel & Audrey Dobbins & Christina Kockel & Jan Steinbach & Ulrich Fahl & Farina Wille & Joachim Globisch & Sandra Wassermann & Bert Droste-Franke & Wolfgang Hauser & Claudia Hofer & Lars, 2020. "Integrating Methods and Empirical Findings from Social and Behavioural Sciences into Energy System Models—Motivation and Possible Approaches," Energies, MDPI, vol. 13(18), pages 1-30, September.

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    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • 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

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