 How do carbon prices spill over along global supply chains? The impact on Europe and GermanyJournal of Policy Modeling, 2024, vol. 46, issue 5, 887-907 Abstract: This paper uses a multisector, multiregional general equilibrium input-output model to study the spillovers of global carbon pricing to Germany and Europe. It uses the World Input-Output Database (WIOD) to calibrate the intersectoral trade between seven regions and 56 economic sectors per region as well as EXIOBASE’s sectoral accounts of greenhouse gas emissions to calibrate emission costs. We find that moving from European-only to global carbon prices does neither reduce nor increase the aggregate GDP loss for Germany or Europe as a whole. However, this masks a large degree of heterogeneity across sectors. Sectors that rely on foreign sectors, which are themselves sensitive to the transition, experience large negative spillovers from global carbon pricing. Other sectors, even those with a high emission or trade intensity, tend to benefit from global carbon pricing due to an improvement in international competitiveness. Keywords: Input-output data; Input-output models; Carbon pricing; Climate scenarios (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jpolmo:v:46:y:2024:i:5:p:887-907 DOI: 10.1016/j.jpolmod.2024.03.005 Access Statistics for this article Journal of Policy Modeling is currently edited by A. M. Costa More articles in Journal of Policy Modeling from Elsevier |
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