Poverty and distributional effects of carbon pricing in low- and middle-income countries – A global comparative analysis

Dorband, Ira Irina; Jakob, Michael; Kalkuhl, Matthias; Steckel, Jan Christoph

doi:10.1016/j.worlddev.2018.11.015

Cited by 186 publications

(109 citation statements)

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“…The cost of non-CO2 emissions constitutes a significant share of the total cost of the carbon tax on consumers, and a significant driver of the regressively of our modeled taxes. Taxing only carbon emissions from fossil fuel without compensation would be progressive in most countries, in line with previous results (supplementary Excel file) 14 . This difference matters for real-life implementation: many carbon tax proposals focus on taxing the carbon content of fossil fuel energy as a first step, as doing can be easier than taxing non-CO2 emissions from agriculture.…”

Section: Direct and Indirect Impacts Of A Carbon Tax On Consumerssupporting

confidence: 90%

“…International studies on distributional impacts of carbon taxes or energy subsidy removal have shown that consumers are affected in two ways: directly through cost increase of fossil fuels and electricity, and indirectly through increasing production costs affecting prices of all goods and services 14,18,30 . We start by quantifying the impact of carbon pricing on consumers in 16 LAC countries (Table 1) in two basic steps.…”

Section: Direct and Indirect Impacts Of A Carbon Tax On Consumersmentioning

confidence: 99%

“…Our approach provides an upper-bound estimate of the short-term impact of carbon taxes on households, before firms adjust production processes and consumers adapt to new prices. If we used a more sophisticated model with a representation of how firms and households from different income levels would adjust to a carbon tax over time, our estimate of the total cost to households of a constant carbon tax would presumably be lowered over time and its incidence could change 14 . On the other hand, a meta-analysis of the literature suggest that modeling the response of firms and consumers plays a limited role in determining whether price hikes are regressive or progressive 31 .…”

Section: Direct and Indirect Impacts Of A Carbon Tax On Consumersmentioning

confidence: 99%

“…But carbon taxes have proved difficult to implement globally, as illustrated by the yellow vest movement in France, the gazolinazo in Mexico, and the rejection of a carbon tax in Washington. 12,13 One stated reason is their potential adverse near-term social impacts, especially on poor and vulnerable housheolds [14][15][16][17][18] . Indeed, the experience of energy subsidy removal suggests that compensating negatively affected households with complementary policies is one of the keys to make reforms that increase the price of basic goods successful [19][20][21][22][23][24][25] .…”

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confidence: 99%

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Cash transfers for pro-poor carbon taxes in Latin America and the Caribbean

et al. 2019

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Any dispute related to the use of the works of the IDB that cannot be settled amicably shall be submitted to arbitration pursuant to the UNCITRAL rules. The use of the IDB's name for any purpose other than for attribution, and the use of IDB's logo shall be subject to a separate written license agreement between the IDB and the user and is not authorized as part of this CC-IGO license. Following a peer review process, and with previous written consent by the Inter-American Development Bank (IDB), a revised version of this work may also be reproduced in any academic journal, including those indexed by the American Economic Association's EconLit, provided that the IDB is credited and that the author(s) receive no income from the publication. Therefore, the restriction to receive income from such publication shall only extend to the publication's author(s). With regard to such restriction, in case of any inconsistency between the Creative Commons IGO 3.0 Attribution-NonCommercial-NoDerivatives license and these statements, the latter shall prevail. Note that link provided above includes additional terms and conditions of the license. The opinions expressed in this publication are those of the authors and do not necessarily reflect the views of the Inter-American Development Bank, its Board of Directors, or the countries they represent.

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Section: Direct and Indirect Impacts Of A Carbon Tax On Consumerssupporting

confidence: 90%

Section: Direct and Indirect Impacts Of A Carbon Tax On Consumersmentioning

confidence: 99%

Section: Direct and Indirect Impacts Of A Carbon Tax On Consumersmentioning

confidence: 99%

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confidence: 99%

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Cash transfers for pro-poor carbon taxes in Latin America and the Caribbean

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“…To assess the distributional effects of climate policies, such as carbon or energy taxes, two major approaches are applied in the literature. These include dynamic CGE models (Abouleinein et al, 2009;Solaymani et al, 2013;van Heerden et al, 2005;Yusuf and Resosudarmo, 2015;Beck et al, 2015;Clements et al, 2007) and static, but more detailed models that use IO data in combination with household data (Dorband et al, 2019;da Silva Freitas et al, 2016;Datta, 2010;Feng et al, 2010a;Grainger and Kolstad, 2010;Kerkhof et al, 2008;Coady and Newhouse, 2006;Wier et al, 2005;Symons et al, 2002;Cornwell and Creedy, 1996). This study builds on the latter approach to quantify indirect impacts of energy price reforms (e.g.…”

Section: Contribution To the Literaturementioning

confidence: 99%

Can government transfers make energy subsidy reform socially acceptable? A case study on Ecuador

et al. 2020

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Copyright© 2019 Inter-American Development Bank. This work is licensed under a Creative Commons IGO 3.0 Attribution NonCommercial-NoDerivatives (CC-IGO BY-NC-ND 3.0 IGO) license (http://creativecommons org/!icenses/by-nc-nd/3 0/igo/ !ega!code) and may be reproduced with attribution to the IDB and for any non-commercial purpose, as provided below. No derivative work is allowed.Any dispute related to the use of the works of the IDB that cannot be settled amicably shall be submitted to arbitration pursuant to the UNCITRAL rules. The use of the I DB's name for any purpose other than for attribution, and the use of I DB's logo shall be subject to a separate written license agreement between the IDB and the user and is not authorized as part of this CC-IGO license.Following a peer review process, and with previous written consent by the Inter-American Development Bank (IDB), a revised version of this work may also be reproduced in any academic journal, including those indexed by the American Economic Association's EconLit, provided that the IDB is credited and that the author(s) receive no income from the publication. Therefore, the restriction to receive income from such publication shall only extend to the publication's author(s). With regard to such restriction, in case of any inconsistency between the Creative Commons IGO 3.0 Attribution-NonCommercial-NoDerivatives license and these statements, the latter shall prevail. Note that link provided above includes additional terms and conditions of the license. The opinions expressed in this publication are those of the authors and do not necessarily reflect the views of the Inter-American Development Bank, its Board of Directors, or the countries they represent. AbstractEnergy subsidies account for about 7% of Ecuador's yearly public spending, or two thirds of the fiscal deficit. Removing these subsidies would yield clear economic and environmental benefits and help implement climate targets set in the Paris Agreement. However, expected adverse effects on vulnerable households can make reforms politically difficult. To inform policy design, we use household survey data from Ecuador in combination with augmented input-output data to assess the distributional impacts of energy subsidy reform. We find that in absolute terms energy subsidies benefit richer households more than poor ones. Relative to household income, subsidy removal without compensation would be regressive for diesel and LPG, progressive for gasoline...

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Carbon Pricing is not Unjust

Mintz‐Woo

2023

Global Challenges

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The aim of this perspective is to argue that carbon pricing is not unjust. Two important dimensions of justice are distributive and procedural (sometimes called “participatory”) justice. In terms of distributive justice, it is argued that carbon pricing can be made distributionally just through revenue recycling and that it should be expected that even neutral reductions in emissions will generate progressive benefits, both internationally and regionally. In terms of procedural justice, it is argued that carbon pricing is in principle compatible with any procedure; however, there is also a particular morally justifiable procedure, the Citizens’ Assembly, which has been implemented in Ireland on this precise question and has generated broad agreement on carbon pricing. It is suggested that this morally matters because such groups are like “ideal advisors” that offer morally important advice. Finally, an independent objection is offered to some ambitious alternatives to carbon pricing like Green New Deal‐type frameworks, frameworks that aim to simultaneously tackle multiple social challenges. The objection is that these will take too long to work in a climate context, both to develop and to iterate.

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Poverty and distributional effects of carbon pricing in low- and middle-income countries – A global comparative analysis

Cited by 186 publications

References 61 publications

Cash transfers for pro-poor carbon taxes in Latin America and the Caribbean

Cash transfers for pro-poor carbon taxes in Latin America and the Caribbean

Can government transfers make energy subsidy reform socially acceptable? A case study on Ecuador

Carbon Pricing is not Unjust

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