Journal article

The Environmental and Economic Impact of the Carbon Tax in Australia

1 Jan 2013
Description

To fulfil its emission reduction target pledged in the Copenhagen accord, the Australian Government has determined to introduce a carbon tax from July 1st 2012. This paper simulates the effects on the environment and on the economy of a carbon tax of A$23 per tonne of carbon dioxide proposed by the government with, and without, a compensation policy. We employ a computable general equilibrium model with an environmentally extended Social accounting matrix. According to the simulation results, the carbon tax can cut emissions effectively, but will cause a mild economic contraction. Because the price signal is intact, the proposed compensation plan has little impact on emission cuts while significantly mitigating the negative effect of a carbon tax on the economy.

Publication Details
Volume: 
Vol.54
Issue: 
No.3
Language: 
Published year only: 
2013
2
Share
Share
Subject Areas
Geographic Coverage
Advertisement