NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Distributional Impacts in a Comprehensive Climate Policy Package

Gilbert E. Metcalf, Aparna Mathur, Kevin A. Hassett

NBER Working Paper No. 16101
Issued in June 2010
NBER Program(s):   EEE   PE

This paper provides a simple analytic approach for measuring the burden of carbon pricing that does not require sophisticated and numerically intensive economic models but which is not limited to restrictive assumptions of forward shifting of carbon prices. We also show how to adjust for the capital income bias contained in the Consumer Expenditure Survey, a bias towards regressivity in carbon pricing due to underreporting of capital income in higher income deciles in the Survey.

Many distributional analyses of carbon pricing focus on the uses-side incidence of carbon pricing. This is the differential burden resulting from heterogeneity in consumption across households. Once one allows for sources-side incidence (i.e. differential impacts of changes in real factor prices), carbon policies look more progressive. Perhaps more important than the findings from any one scenario, our results on the progressivity of the leading cap and trade proposals are robust to the assumptions made on the relative importance of uses and sources side heterogeneity.

download in pdf format
   (146 K)

email paper

This paper is available as PDF (146 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w16101

Published: Distributional Impacts in a Comprehensive Climate Policy Package, Gilbert E. Metcalf, Aparna Mathur, Kevin A. Hassett. in The Design and Implementation of U.S. Climate Policy, Fullerton and Wolfram. 2012

Users who downloaded this paper also downloaded these:
Deschenes w16111 Climate Policy and Labor Markets
Rausch, Metcalf, Reilly, and Paltsev w16053 Distributional Implications of Alternative U.S. Greenhouse Gas Control Measures
Baicker, Mullainathan, and Schwartzstein w18468 Behavioral Hazard in Health Insurance
Hassett, Mathur, and Metcalf w13554 The Incidence of a U.S. Carbon Tax: A Lifetime and Regional Analysis
Smith w16100 How Can Policy Encourage Economically Sensible Climate Adaptation?
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us