Distributional impacts of reaching ambitious near-term climate targets across households with heterogeneous consumption patterns: A quantitative macro-micro assessment for the 2030 Climate Target Plan of the EU Green Deal

Umed Temursho, Matthias Weitzel and Toon Vandyck ()
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Toon Vandyck: European Commission - JRC, https://joint-research-centre.ec.europa.eu/index_en

No JRC121765, JRC Research Reports from Joint Research Centre

Abstract: This report enriches economy-wide modelling with household-level microdata to assess the distributional impacts of climate policy in the broader context of the EU Green Deal. The first part of the report provides a detailed exploration of the EU Household Budget Survey data in the light of its use in analysing climate policy impacts across households with heterogeneous consumption patterns. The second part of the report describes the macro-micro framework to combine the Household Budget Survey with the JRC-GEM-E3 model. The third part studies scenarios that cover three different policy configurations –ranging from a regulation-based to a pricing-based approach – all of which reach a reduction in greenhouse gas emissions of 55% in 2030 relative to 1990. Results provide insights into the potential distributional implications across EU households of an upward revision of the 2030 targets, a key aspect in achieving a Just Transition to climate neutrality. Regulation-based policies can mitigate price changes observed by households, while pricing-based policies raise revenue that have the potential to offset regressive impacts. Careful design of targeted complementary measures will therefore be required to reconcile social and environmental sustainability.

Keywords: Just Transition; Climate Policy; Distributional Impacts; Household Budget Survey; Computable General Equilibrium (search for similar items in EconPapers)
Pages: 67 pages
Date: 2020-10
New Economics Papers: this item is included in nep-ene, nep-env and nep-reg
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Citations: View citations in EconPapers (3)

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