Department of Management Science
Stanford, CA 94305
Institutional Affiliation: Stanford University
NBER Working Papers and Publications
|December 2019||China's Unconventional Nationwide CO2 Emissions Trading System: The Wide-Ranging Impacts of an Implicit Output Subsidy|
with Lawrence H. Goulder, Jieyi Lu, Richard D. Morgenstern: w26537
China is planning to implement the largest CO2 emissions trading system in the world. To reduce emissions, the system will be a tradable performance standard (TPS), an emissions pricing mechanism that differs significantly from the emissions pricing instruments used in other countries, such as cap and trade (C&T) and a carbon tax. We employ matching analytically and numerically solved models to assess the cost-effectiveness and distributional impacts of China’s forthcoming TPS for achieving CO2 emissions reductions from the power sector.
We find that the TPS’s implicit subsidy to electricity output has wide-ranging consequences for both cost-effectiveness and distribution. In terms of cost-effectiveness, the subsidy disadvantages the TPS relative to C&T by causing ...
|October 2018||Impacts of a Carbon Tax across US Household Income Groups: What Are the Equity-Efficiency Trade-Offs?|
with Lawrence H. Goulder, Marc A. C. Hafstead, GyuRim Kim: w25181
This paper assesses the impacts across US household income groups of carbon taxes of various designs. We consider both the source-side impacts (reflecting how policies affect nominal wage, capital, and transfer incomes) and the use-side impacts (reflecting how policies alter prices of goods and services purchased by households). We apply an integrated general equilibrium framework with extended measures of the source- and use-side impacts that add up to the overall welfare impact. The distributional impacts depend importantly on the revenue recycling method and treatment of transfer income. In the absence of compensation targeted to particular income groups, use-side impacts tend to be regressive and source-side impacts progressive, with the progressive source-side impacts fully offsetting...
Published: Lawrence H. Goulder & Marc A.C. Hafstead & GyuRim Kim & Xianling Long, 2019. "Impacts of a carbon tax across US household income groups: What are the equity-efficiency trade-offs?," Journal of Public Economics, vol 175, pages 44-64. citation courtesy of