An interesting new paper on virtual carbon (although when I see the world GTAP it depresses me).
One of the authors, Kirk Hamilton, will be visiting the University of Birmingham on Monday next week. He will be making a presentation at 5pm in Lecture Theatre G06 in the Business School entitled:
“Development and Climate Change: Main Messages and Selected Economic Insights from the World Development Report 2010”.
Everyone is welcome to attend. So any blog readers in the Birmingham area please pop along and way hello if you can recognise me.
Here is the paper:
Trade In'Virtual Carbon': Empirical Results and Implications for Policy
London School of Economics and Political Science (LSE) - Department of Geography and Environment
World Bank - Environment and Natural Resources Division
Dominique Van der Mensbrugghe
World Bank Policy Research Working Paper No. 5194
The fact that developing countries do not have carbon emission caps under the Kyoto Protocol has led to the current interest in high-income countries in border taxes on the"virtual"carbon content of imports. The authors use Global Trade Analysis Project data and input-output analysis to estimate the flows of virtual carbon implicit in domestic production technologies and the pattern of international trade. The results present striking evidence on the wide variation in the carbon-intensiveness of trade across countries, with major developing countries being large net exporters of virtual carbon. The analysis suggests that tax rates of $50 per ton of virtual carbon could lead to very substantial effective tariff rates on the exports of the most carbon-intensive developing nations.
Keywords: Climate Change Mitigation and Green House Gases, Environmental Economics & Policies, Climate Change Economics, Economic Theory & Research, Environment and Energy Efficiency