Market power rents and climate change mitigation: A rationale for coal taxes?

Arbeitspapier

In this paper we investigate the introduction of an export tax on steam coal levied by an individual country (Australia), or a group of major exporting countries. The policy motivation would be twofold: generating tax revenues against the background of improved terms-of-trade, while CO2 emissions are reduced. We construct and numerically apply a two-level game consisting of an optimal policy problem at the upper level, and an equilibrium model of the international steam coal market (based on COALMOD-World) at the lower level. We find that a unilaterally introduced Australian export tax on steam coal has little impact on global emissions and may be welfare reducing. On the contrary, a tax jointly levied by a "climate coalition" of major coal exporters may well leave these better off while significantly reducing global CO2 emissions from steam coal by up to 200 Mt CO2 per year. Comparable production-based tax scenarios consistently yield higher tax revenues but may be hard to implement against the opposition of disproportionally affected local stakeholders depending on low domestic coal prices.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: DIW Discussion Papers ; No. 1471

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Energy: Government Policy ; Trade Policy; International Trade Organizations ; Environmental Economics: Government Policy ; Energy: Demand and Supply; Prices ; Optimization Techniques; Programming Models; Dynamic Analysis
• Thema: export tax ; steam coal ; supply-side climate policy ; carbon leakage ; Australia ; Mathematical Program with Equilibrium Constraints (MPEC)

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Richter, Philipp M. ; Mendelevitch, Roman ; Jotzo, Frank
• Ereignis: Veröffentlichung
• (wer): Deutsches Institut für Wirtschaftsforschung (DIW)
• (wo): Berlin
• (wann): 2015

Weitere Informationen

• Handle: http://hdl.handle.net/10419/110330
• Letzte Aktualisierung: 10.03.2025, 11:43 MEZ