Low Carbon Development and Carbon Taxes in South Africa

Channing Arndt, Rob Davies, Konstantin Makrelov and James Thurlow

No 332130, Conference papers from Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project

Abstract: South Africa is the world‟s most carbon-intensive non-oil-producing developing country. However, there is much debate over the appropriateness of policies to reduce carbon emissions. We estimate the carbon intensity of different industries, products and households using adapted multiplier methods based on a supply-use table and accounting for energy price variations. Results confirm the importance of measuring both direct and indirect carbon usage within a framework that captures inter-industry linkages and multiproduct supply chains. South African exports are amongst the most carbon-intensive products; laborintensive and major employing sectors are amongst the least carbon intensive; and middle-income households are the most carbon-intensive consumers. These results suggest that carbon pricing policies would adversely affect export earnings, unless the carbon content of exports is properly rebated, and that these policies should not disproportionately hurt workers or poorer households. Results indicate that seven percent of emissions arise though marketing margins. This implies a key role for transport policy, and suggests that public investments should accompany carbon pricing.

Keywords: Environmental Economics and Policy; Public Economics (search for similar items in EconPapers)
Pages: 24
Date: 2011
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Persistent link: https://EconPapers.repec.org/RePEc:ags:pugtwp:332130

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