The progressive relocation of part of the Energy Intensive Industries (EIIs) out of Europe is one of the possible consequences of the combination of emission charges and higher electricity prices entailed by the EU-Emission Trading Scheme (EU-ETS). In order to mitigate this effect, EIIs have...

Carbon leakage in this pape ris the phenomenon whereby Electricity Intensive Industries subject to harsh environmental standards move their activity or part of it to more environmentally lenient regions. Carbon leakage has been mentioned as a possible outcome of the EU Emission Trading Scheme....

Considering the costs and risks of inaction, ambitious action to reduce greenhouse gas emissions is economically rational. However, success in abating world emissions will ultimately require a least-cost set of policy instruments that is applied as widely as possible across all emission sources...

Unilateral carbon policies are inefficient due to the fact that they generally involve emission reductions in countries with high marginal abatement costs and because they are subject to carbon leakage. In this paper, we ask whether the use of carbon tariffs—tariffs on the carbon embodied in...

The efficiency of unilateral climate policies may be hampered by carbon leakage and competitiveness losses. A widely discussed policy option to reduce leakage and protect competitiveness of heavy industries is to impose Border Carbon Adjustments (BCA) to non regulated countries, which remains...

The efficiency of unilateral climate policies may be hampered by carbon leakage and competitiveness losses. A widely discussed policy option to reduce leakage and protect competitiveness of heavy industries is to impose border carbon adjustments (BCAs). The estimation of carbon leakage as well...

International agricultural trade flows are increasingly important as distant drivers in global land-use changes, creating teleconnections between geographically separated locations of consumption and production. Land-use displacement and associated carbon emissions can undermine the...

Climate policy under partial global compliance raises concerns regarding carbon leakage. While border carbon adjustment (BCA) measures are a potential remedy, they have also been criticised on various grounds. This paper therefore investigates whether a policy fostering the switch to carbon-free...

We consider a North-South trade model with cross-border environmental damage where the North imports the relatively dirty good. The North sets domestic production taxes according to each industry’s contribution to environmental degradation (Pigouvian taxes), but this exacerbates cross-border...

This paper deals with possible foreign reactions to unilateral carbon demand reducing policies. It differentiates between demand side and supply side reactions as well as between intra- and intertemporal shifts in greenhouse gas emissions. In our model, we integrate a stock-dependent marginal...