Arbeitspapier

Climate change mitigation policies: Aggregate and distributional effects

We evaluate the aggregate and distributional effects of climate change mitigation policies using a multi-sector equilibrium model with intersectoral input-output linkages and worker heterogeneity calibrated to different countries. The introduction of carbon taxes leads to changes in relative prices and inputs reallocation, including labor. For the United States, reaching its original Paris Agreement pledge would imply at most a 0.8% drop in output. This impact is distributed asymmetrically across sectors and individuals. Workers with a comparative advantage in dirty energy sectors who do not reallocate suffer a welfare loss at least six times larger than workers in other sectors, but constitute less than 2% of the US labor force.

Language
Englisch

Bibliographic citation
Series: IDB Working Paper Series ; No. IDB-WP-1387

Classification
Wirtschaft
General Aggregative Models: Neoclassical
Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
Human Capital; Skills; Occupational Choice; Labor Productivity
Subject
Climate change
Carbon taxes
Worker heterogeneity
Labor reallocation

Event
Geistige Schöpfung
(who)
Cavalcanti, Tiago
Hasna, Zeina
Santos, Cézar
Event
Veröffentlichung
(who)
Inter-American Development Bank (IDB)
(where)
Washington, DC
(when)
2022

DOI
doi:10.18235/0004535
Last update
10.03.2025, 11:45 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Cavalcanti, Tiago
  • Hasna, Zeina
  • Santos, Cézar
  • Inter-American Development Bank (IDB)

Time of origin

  • 2022

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