EconPapers    
Economics at your fingertips  
 

Taxing crude oil: A financing alternative to mitigate climate change?

Arturo Antón-Sarabia ()

Energy Policy, 2020, vol. 136, issue C

Abstract: To date, global cooperation has not provided enough funds to counter climate change, as evidenced by the Green Climate Fund experience. Based on this fact, this document evaluates the revenue potential of an international tax on crude oil to finance programs to mitigate climate change. For this purpose, a dynamic, general equilibrium model for the world economy with two regions is proposed. One region is a net importer of oil, while the other is an exporter. In the model, oil exports are subject to a permanent per-barrel tax. Short- and long-run revenue projections are offered under alternative assumptions. Some exercises suggest that the resources generated from a $5 per-barrel tax on 25% of world oil exports would amount to $18.4 billion dollars in the initial year. To implement such policy at the international level, an “Oil and Climate Club” is proposed, where revenues from oil taxation would be allocated to funding environment-friendly programs. The paper includes a discussion on how to make the club's rules consistent with international trade laws.

Keywords: Crude oil; Climate change; Taxes; Climate clubs; Green climate fund (search for similar items in EconPapers)
JEL-codes: E13 F47 H23 H87 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0301421519306184
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:136:y:2020:i:c:s0301421519306184

DOI: 10.1016/j.enpol.2019.111031

Access Statistics for this article

Energy Policy is currently edited by N. France

More articles in Energy Policy from Elsevier
Bibliographic data for series maintained by Haili He ().

 
Page updated 2021-01-08
Handle: RePEc:eee:enepol:v:136:y:2020:i:c:s0301421519306184