EconPapers    
Economics at your fingertips  
 

A computable general equilibrium analysis of the EU CBAM for the Japanese economy

Shiro Takeda and Toshi Arimura

Japan and the World Economy, 2024, vol. 70, issue C

Abstract: The EU plans to introduce a carbon border adjustment mechanism (CBAM) to curb carbon leakage and to protect energy-intensive and trade-exposed (EITE) industries. This move by the EU to introduce CBAMs has raised concerns in Japan that it will harm Japanese industry and the Japanese economy. To address these concerns, this study tries to provide an ex ante and quantitative analysis of the economic and environmental effects of the introduction of the EU CBAM. To capture the effects of the EU CBAM, this study employs a global multiregional, multisector computable general equilibrium model with 18 sectors and 17 regions. The main insights obtained from the analysis are as follows. First, we find that the introduction of the EU CBAM significantly reduces carbon leakage from the EU. Second, the effects of the introduction of CBAMs on the GDP and welfare of each country vary from country to country, but the effects are generally very small. While there is a positive impact on GDP and welfare in Japan, the magnitude of the impact is very small. There will also be a negative impact on Japan’s EITE industries, but the magnitude of this impact is very small and not of great concern.

Keywords: Climate change; Carbon border adjustment mechanism; Computable general equilibrium analysis (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0922142524000057
Full text for ScienceDirect subscribers only

Related works:
Working Paper: A Computable General Equilibrium Analysis of EU CBAM for the Japanese Economy (2023) Downloads
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:japwor:v:70:y:2024:i:c:s0922142524000057

DOI: 10.1016/j.japwor.2024.101242

Access Statistics for this article

Japan and the World Economy is currently edited by Robert Dekle and Yasushi Hamao

More articles in Japan and the World Economy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

 
Page updated 2025-03-23
Handle: RePEc:eee:japwor:v:70:y:2024:i:c:s0922142524000057