Sensitivity of Modeling Results to Technological and Regional Details: The Case of Italy’s Carbon Mitigation Policy

Gabriele Standardi, Yiyong Cai and Sonia Yeh

No 256059, EIA: Climate Change: Economic Impacts and Adaptation from Fondazione Eni Enrico Mattei (FEEM)

Abstract: Model differences in technological and geographical scales are common, but their contributions to uncertainties have not been systematically quantified in the climate policy literature. This paper carries out a systematic assessment on the sensitivity of Computable General Equilibrium models to technological and geographical scales in evaluating the economic impacts of carbon mitigation policies. Taking Italy as an example, we find that the estimation for carbon price and the economic cost of a de-carbonization pathway by means of a model with technological and regional details can be lower than a model without such details by up to 40%. Additionally, the effect of representing regional details appears to be far more important than the effect of representing the details of electricity technology in both the estimated carbon prices and the estimated economic impacts. Our results for Italy highlight the importance of modeling uncertainties of these two key assumptions, which should be appropriately acknowledged when applying CGE models for policy impact assessment. Our conclusions can be generalized to different countries and policy scenarios not in terms of absolute numbers but in terms of economic explanations. In particular, intra-national trade and the sub-national sectoral/technological specialization are important variables for understanding the economic dynamics behind these outcomes.

Keywords: Research; and; Development/Tech; Change/Emerging; Technologies (search for similar items in EconPapers)
Pages: 38
Date: 2017-04-12
New Economics Papers: this item is included in nep-ene and nep-env
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://ageconsearch.umn.edu/record/256059/files/NDL2017-019.pdf (application/pdf)

Related works:
Journal Article: Sensitivity of modeling results to technological and regional details: The case of Italy's carbon mitigation policy (2017)
Working Paper: Sensitivity of Modeling Results to Technological and Regional Details: The Case of Italy’s Carbon Mitigation Policy (2017)
Working Paper: Sensitivity of Modeling Results to Technological and Regional Details: The Case of Italy’s Carbon Mitigation Policy (2016)
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:ags:feemei:256059

DOI: 10.22004/ag.econ.256059

Access Statistics for this paper

More papers in EIA: Climate Change: Economic Impacts and Adaptation from Fondazione Eni Enrico Mattei (FEEM) Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().