Arbeitspapier
Unilateral carbon pricing and heterogeneous firms
Several empirical studies document the relevance of firm heterogeneity to assess the effect of trade and environmental policy. This paper develops a multi-country and -sector general equilibrium trade model with heterogeneous firms and analyzes the effect of domestic carbon pricing as well as carbon border adjustments. In the presence of heterogeneous firms, these unilateral carbon pricing tools affect the emission intensity both via within- and across-firm adjustments. I show that the across-firm reallocation of market shares can be quantified ex-ante using publicly available data on the share of exporting firms. Applying the model to EU climate policy, I find that emission reductions arise mainly through a lower emission intensity of production within firms, while the reallocation channel is negligible. Scale economies aggravate the output loss of emission-intensive manufacturing and the reduction of real income due to more stringent climate policy, but increase the effectiveness of border adjustments to counter carbon leakage. The selection of heterogeneous plays a more limited role for aggregate effects.
- Sprache
-
Englisch
- Erschienen in
-
Series: DIW Discussion Papers ; No. 2060
- Klassifikation
-
Wirtschaft
Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
Trade Policy; International Trade Organizations
Trade and Environment
Climate; Natural Disasters and Their Management; Global Warming
Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
- Thema
-
International trade
Firm heterogeneity
Unilateral climate policy
Carbon Border Adjustment
GHG emissions
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Sogalla, Robin
- Ereignis
-
Veröffentlichung
- (wer)
-
Deutsches Institut für Wirtschaftsforschung (DIW)
- (wo)
-
Berlin
- (wann)
-
2023
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:45 MEZ
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Sogalla, Robin
- Deutsches Institut für Wirtschaftsforschung (DIW)
Entstanden
- 2023
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