Mitigating size bias for carbon pricing in small Asia-Pacific countries: Increasing block carbon tax

An, Y; Zhou, D; Wang, Q; Shi, X; Taghizadeh-Hesary, F

Mitigating size bias for carbon pricing in small Asia-Pacific countries: Increasing block carbon tax

An, Y Zhou, D Wang, Q Shi, X

Taghizadeh-Hesary, F

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Publisher:: ELSEVIER SCI LTD
Publication Type:: Journal Article
Citation:: Energy Policy, 2022, 161
Issue Date:: 2022-02-01

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Field	Value	Language
dc.contributor.author	An, Y
dc.contributor.author	Zhou, D
dc.contributor.author	Wang, Q
dc.contributor.author	Shi, X https://orcid.org/0000-0001-9653-7395
dc.contributor.author	Taghizadeh-Hesary, F
dc.date.accessioned	2022-11-01T21:49:01Z
dc.date.available	2022-11-01T21:49:01Z
dc.date.issued	2022-02-01
dc.identifier.citation	Energy Policy, 2022, 161
dc.identifier.issn	0301-4215
dc.identifier.issn	1873-6777
dc.identifier.uri	http://hdl.handle.net/10453/163117
dc.description.abstract	While the popularity of emission trading schemes (ETS) has exceeded that of carbon taxes, ETS is not applicable to all countries. This paper investigates the increasing block carbon tax (IBCT), which is a modified carbon tax based on the increasing block tariffs theory. The IBCT considers the size bias in emission reduction, and this paper discusses whether it is suitable for small Asia-Pacific countries (SAPCs). Both theoretical analysis and numerical simulation were used to compare the impacts of IBCT and flat carbon tax (FCT) on the emission reduction behavior of manufacturers in both purely competitive and co-opetitive market environments. This study demonstrates that the IBCT is better than the prevailing FCT, and the results indicate that this could be a better choice for SAPCs. The implementation of the IBCT policy in SAPCs can protect domestic manufacturers and decrease the risk of carbon leakage. The IBCT promotes low-carbon production when the manufacturers expand their scale, which can lead to a win-win situation for social welfare and environmental development. We suggest that the IBCT should be implemented in high-carbon industries; its formulation needs more market details than FCT. Besides the policy, the development of reduction technologies also cannot be ignored.
dc.language	English
dc.publisher	ELSEVIER SCI LTD
dc.relation.ispartof	Energy Policy
dc.relation.isbasedon	10.1016/j.enpol.2021.112771
dc.rights	info:eu-repo/semantics/embargoedAccess
dc.subject.classification	Energy
dc.title	Mitigating size bias for carbon pricing in small Asia-Pacific countries: Increasing block carbon tax
dc.type	Journal Article
utslib.citation.volume	161
pubs.organisational-group	/University of Technology Sydney
pubs.organisational-group	/University of Technology Sydney/DVC (International)
pubs.organisational-group	/University of Technology Sydney/DVC (International)/Australia-China Relations Institute
utslib.copyright.status	open_access	*
utslib.copyright.embargo	2024-02-01T00:00:00+1000Z
dc.date.updated	2022-11-01T21:49:00Z
pubs.publication-status	Published
pubs.volume	161

Abstract:

While the popularity of emission trading schemes (ETS) has exceeded that of carbon taxes, ETS is not applicable to all countries. This paper investigates the increasing block carbon tax (IBCT), which is a modified carbon tax based on the increasing block tariffs theory. The IBCT considers the size bias in emission reduction, and this paper discusses whether it is suitable for small Asia-Pacific countries (SAPCs). Both theoretical analysis and numerical simulation were used to compare the impacts of IBCT and flat carbon tax (FCT) on the emission reduction behavior of manufacturers in both purely competitive and co-opetitive market environments. This study demonstrates that the IBCT is better than the prevailing FCT, and the results indicate that this could be a better choice for SAPCs. The implementation of the IBCT policy in SAPCs can protect domestic manufacturers and decrease the risk of carbon leakage. The IBCT promotes low-carbon production when the manufacturers expand their scale, which can lead to a win-win situation for social welfare and environmental development. We suggest that the IBCT should be implemented in high-carbon industries; its formulation needs more market details than FCT. Besides the policy, the development of reduction technologies also cannot be ignored.

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http://hdl.handle.net/10453/163117