| 摘要 | ABSTRACT
There is an almost universal consensus that anthropogenic greenhouse gas (GHG) emissions is the main culprit behind the observed changes in our climate system. This has slowly led governments around the world to implement policies and measures that reduce or limit GHG emissions. Though most of these policies and measures follow either a command and control approach or a market-based approach, market-based approaches have gained popularity in recent years.
The basic idea behind market-based approaches is to place a price on GHG emissions and the two prevalent instruments are carbon taxes and cap-and-trade schemes. A carbon tax is a price instrument that imposes a direct levy on each unit of GHG emissions, while a cap-and-trade scheme is a quantity instrument that sets an overall limit, or a cap and distributes a fixed number of permits (allowances) among firms that produce emissions.
At the Copenhagen climage change conference in 2009, South Korea announced a target to reduce GHG emissions to 30% below its projected business-as-usual (BAU) levels by 2020. South Korea has chosen cap-and-trade program, a nationwide Emissions Trading Scheme (ETS), which is to be launched January next year, to be the key instrument in achieving this ambitious target.
The pros and cons of price vs. quantity instruments have been extensively studied. However, to our knowledge, no significant work has been done in the context of BAU reduction targets, which is much needed in order for Korea to successfully achieve its 2020 target while minimizing the economic losses and maximizing environmental benefits.
In this paper, we develop a simple dynamic macroeconomic model to evaluate the relative effectiveness of a cap-and-trade program and a carbon tax by comparing the differences in the welfare loss. Using the model, we first derive an emissions path under the BAU scenario in the period between year 2010 and 2020, then determine the ��target�� emission reduction path necessary to achieve Korea��s 2020 reduction target. Then, the welfare loss relative to the BAU scenario due to a schedule of carbon taxes that realizes the ��target�� path are compared with the one due to the implementation of ETS.
Our calibration results show that while there is not much difference in emissions reduced between the two policy scenarios relative to the BAU scenario during the study period, the relative welfare loss is lower in the case of ETS. This may be because in the short run a quantity control is more effectiveness, while in the long-run carbon taxes that can be adjusted to buffer exogenous macroeconomic shocks are better suited.
There are several limitations to our study, however. First, our study does not take into account banking and borrowing of allowances that can have large short-term effects. Second, exogenous shocks such as productivity shocks to energy sector are not considered. This is likely to be consistent with short-run dynamics, however, as the recent ��shale-gas revolution�� experience implies, shocks to the energy sector needs to be considered in the long-run. Lastly, the current BAU reduction target is only a temporary target and inevitably, Korea needs to move towards an absolute emissions reduction target. Thus, our model needs to be extended to derive the optimal timing of switching to an absolute target. |
