Selected International Aspects of Carbon Taxation
American Economic Review
vol. 104,
no. 5, May 2014
(pp. 552-56)
Abstract
Disparate commitments to reduce GHG emissions create demands for border carbon adjustments (BCAs) to prevent negative competitive effects and carbon leakage. BCAs that accomplish economic objectives and are administratively feasible, WTO-legal, and politically acceptable may be impossible. BCAs should be limited to a few basic energy-intensive and trade-exposed products and should be based on the lower of the carbon content of production in the importing country and actual carbon content, or perhaps "best available technology." Whether the World Trade Organization (WTO) would condone BCAs is unclear. BCAs violating basic trade rules might qualify for a special exception.Citation
McLure, Charles E Jr. 2014. "Selected International Aspects of Carbon Taxation." American Economic Review, 104 (5): 552-56. DOI: 10.1257/aer.104.5.552Additional Materials
JEL Classification
- H23 Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
- H43 Project Evaluation; Social Discount Rate
- H87 International Fiscal Issues; International Public Goods
- Q54 Climate; Natural Disasters; Global Warming
- Q58 Environmental Economics: Government Policy