We examine the impact of a unilateral carbon tax in developed countries focusing on the expected size of carbon leakage (an increase in emissions in non-taxing regions as a result of the tax) and the effects on leakage of border tax adjustments. We start by analyzing the problem using a simple...

While computable general equilibrium (CGE) models are a well-established tool in economic analyses, it is often difficult to disentangle the effects of policies of interest from that of the assumptions made regarding the underlying calibration data and model parameters. To characterize the...