Trade in Carbon and Carbon Tariffs

Abstract Carbon-based import tariffs are proposed as a policy measure to reduce carbon leakage and increase the global cost-effectiveness of unilateral CO 2 emission pricing. We investigate case for tariffs. For our assessment, we combine multi-region input–output computable general equilibrium analyses based on data from World Input–Output Database period 2000–2014. The analysis confirms that embodied in trade has increased during this period, but flows Non-OECD OECD countries became less important relative terms since 2007–2008 financial crisis. suggests tariffs’ efficacy combating increases periods when increases. However, its potential improve global-cost effectiveness pricing remains modest. On other hand, find shift economic burden reduction abating developed regions non-abating developing sharply between 2000 2007, declines after