Global CO2 Emission Reductions -the Impacts of Rising Energy Costs*

Abstract

In this paper, we explore how the costs of a C02 limit are likely to vary among regions. The analysis is based on Global 2100: an analytical framework for estimating the economy-wide impacts of rising energy costs. We investigate how emissions are likely to evolve in the absence of a carbon limit, and how the regional pattern is likely to shift during the next century. We then examine alternative strategies to limit global emissions, calculate the impacts of higher energy costs upon conventionally measured GDP, and indicate the size of the carbon tax that would be required to induce individual consumers to reduce their dependence on carbon-intensive fuels.

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