Suchergebnisse

This paper discusses incentives for investments in transport infrastructure and commuting subsidies in a multi-region framework. Responsibilities of fiscal treatment of commuting expenses, public provision of road infrastructure and road pricing are distributed among different levels of government. The incentives of governments are discussed in a setting with commuting from a peripheral, less productive area to an urban agglomeration or city center. The interactions between investment in transport infrastructure, road pricing and commuting subsidies are analyzed. First, the optimal number of commuters from the point of view of the federation is derived in a first best situation. When a tax on labor is levied to finance the investment in transportation, a commuting subsidy can correct the labor tax distortion and the first best outcome can be obtained. However, when the peripheral region is in control of the transport policy and perceives its position as a dominant supplier of labor, the regional government will have an incentive to strategically restrict the number of commuters. This will lead to a commuting tax. In addition, there will be underinvestment in infrastructure investment. The city government faces different incentives. On the one hand, profits made in the city increase with the commuting flow. Assuming profits are captured locally, the city thus benefits from a higher number of commuters. On the other hand, the city can raise tax revenues by taxing commuters. Therefore, tax exporting behavior can be one of the drivers of the city's transport policy. The result is a situation where the city invests in transport infrastructure to attract commuters and sets a tax on commuters to raise government revenues. We show that the intensity of the regional strategic behavior is affected by firm ownership structure, the number of labor-supplying regions and the revenue-sharing mechanism in the federation. The paper also looks into vertical tax competition and identifies possibilities for the federal government to correct the incentive structure through mechanism design. A numerical example illustrates the insights for commuting in Belgium.

Concerns about industry competitiveness and distributional impacts can deter ambitious climate policies. Typically, these issues are studied separately, without giving much attention to the interaction between the two. Here, we explore how carbon leakage reduction measures affect distributional outcomes across households within 11 European countries by combining an economy-wide computable general equilibrium model with a household-level microsimulation model. Quantitative simulations indicate that a free allocation of emission permits to safeguard the competitive position of energy-intensive trade-exposed industries leads to impacts that are slightly more regressive than under full auctioning. We identify three channels that contribute to this effect: higher capital and labour income; lower tax revenue for compensating low-income households; and stronger consumption price increases following from higher carbon prices needed to reach the same emissions target. While these findings suggest a competitiveness-equity trade-off, the results also show that redistributing the revenues from partial permit auctioning on an equal-per-household basis still ensures that climate policy is progressive, indicating that there is room for policy to reconcile competitiveness and equity concerns. Finally, we illustrate that indexing social benefits to consumer price changes mitigates pre-revenue-recycling impact regressivity, but is insufficient to compensate vulnerable households in the absence of other complementary measures.

Concerns about industry competitiveness and distributional impacts can deter ambitious climate policies. Typically, these issues are studied separately, without giving much attention to the interaction between the two. Here, we explore how carbon leakage reduction measures affect distributional outcomes across households within 11 European countries by combining an economy-wide computable general equilibrium model with a household-level microsimulation model. Quantitative simulations indicate that a free allocation of emission permits to safeguard the competitive position of energy-intensive trade-exposed industries leads to impacts that are slightly more regressive than under full auctioning. We identify three channels that contribute to this effect: higher capital and labour income; lower tax revenue for compensating low-income households; and stronger consumption price increases following from higher carbon prices needed to reach the same emissions target. While these findings suggest a competitiveness-equity trade-off, the results also show that redistributing the revenues from partial permit auctioning on an equal-per-household basis still ensures that climate policy is progressive, indicating that there is room for policy to reconcile competitiveness and equity concerns. Finally, we illustrate that indexing social benefits to consumer price changes mitigates pre-revenue-recycling impact regressivity, but is insufficient to compensate vulnerable households in the absence of other complementary measures.

Estimates of economic implications of climate policy are important inputs into policy-making. Despite care to contextualize quantitative assessments of mitigation costs, one strong view outside academic climate economics is that achieving Paris Agreement goals implies sizable macroeconomic losses. Here, we argue that this notion results from unwarranted simplification or omission of the complexities of quantifying mitigation costs, which generates ambiguity in communication and interpretation. We synthesize key factors influencing mitigation cost estimates to guide interpretation of estimates, for example from the Intergovernmental Panel on Climate Change, and suggest ways to improve the underlying models. We propose alternatives for the scenario design framework, the framing of mitigation costs and the methods used to derive them, to better inform public debate and policy. ; Aside from "PARIS REINFORCE" (Grant No. 820846), the authors also gratefully acknowledge the financial support from EU Horizon 2020 Projects ENGAGE (GA: 821471) and NAVIGATE (GA: 821124)

Accurate and complete environmental information is at the basis of any effective sustainable development policy. This report summarises for the first time the status of air, climate, water and soil in the Western Balkans (WB), describing current knowledge as of 2021 and gaps with respect to the EU aquis in order to: a) benchmark the progress during the accession process, and b) support the implementation of the Green Agenda for the WB with particular reference to depollution and decarbonisation priorities. This information is also relevant for the EU Green Deal zero pollution ambition, as depollution in WB also reduces pollutant levels in neighbouring EU Member States. Despite significant improvements in the alignment of the climate and GHG emissions monitoring and reporting legislation and the good progress in the areas of air and water pollution in the latest two years, the EU aquis implementation is still lagging. The overall WB air quality situation is still critical and the pollution trend is often upwards, despite PM10 and PM2.5 concentration have decreased in certain areas. Due to its dominant impact on mortality, PM2.5 can be considered the main pollutant to target in the WB. The energy sector, in particular coal-fuelled power plants, is the major source of SO2 and CO2 emissions and an important source of other pollutants. It offers a concrete opportunity for co-benefits between air quality and climate policies. The increase in intensity and frequency of summer heatwaves in the latest decades is an indicator of climate change in the WB and the need to design appropriate adaptation plans to cope with it. The status of waterbodies in the WB can generally be assessed as unsatisfactory. In the case of chemical status, 45% of waterbodies assessed failed to reach good status, while in the ecological assessment 54% failed to reach good status. Case studies on antibiotic resistance, as well as effect-based studies on mixtures of pollutants confirmed that aquatic ecosystems, particularly large fluvial rivers, are ...