Carbon Leakage and a Post-Kyoto Framework

要旨

In this paper, we use the concept of carbon leakage to evaluate the effectiveness of a Kyoto-type international framework as an international mitigation abatement framework. By using a dynamic computable general equilibrium model, we estimate the carbon leakage rate, and by using the decomposition method, we analyse the actual mechanism of carbon leakage.

The United States (USA) is estimated to be the biggest contributor to carbon leakage in 2020, but the contribution in 2020 (USA, 17.29%) is slightly lower than in 2010 (USA, 18.21%). On the other hand, China (CHN, 6.73% in 2010 and 7.90% in 2020) and other Asia (ASA, 5.69% in 2010 and 6.21% in 2020) increase their carbon leakage share. China is expected to continue with its high level of economic growth and China’s economic and energy consumption share in the world will increase as well. As a result, carbon leakage to China will more readily occur.

We, therefore, need to change the way to control greenhouse gas emissions by moving from a reduction target to more fully embracing the polluter-pays-principle (PPP).