IDEAS home Printed from https://ideas.repec.org/p/ekd/002625/3036.html
   My bibliography  Save this paper

Intertemporal trade and the Integrated Assessment of climate change mitigation policies

Author

Listed:
  • Marian Leimbach
  • Baumstark, Lavinia

Abstract

Within this paper, we discuss problems and solutions of integrating intertemporal trade into an economy-energy-environment model. Modeling intertemporal trade provides additional flexibility in achieving economic development as well as environmental sustainability targets, that likely corresponds to real-world flexibility. However, model output is challenged by empirical data. This paper demonstrates attempts how, based on trade-theoretical concepts, empirics and model results are reconciled with each other. Model results are provided by simulations with an economic growth/Integrated Assessment model in an environment of free trade and perfect competition. Within a climate policy context, the question arises to what extent climate policy assessments are sensitive against the integration of intertemporal trade and the way intertemporal trade is modelled. From simulation results it transpires that global and regional mitigation costs are quite insensitive to the inclusion of intertemporal trade and to trade-related adjustments as long as changes in the baseline development are taken into account.

Suggested Citation

  • Marian Leimbach & Baumstark, Lavinia, 2011. "Intertemporal trade and the Integrated Assessment of climate change mitigation policies," EcoMod2011 3036, EcoMod.
    • Handle: RePEc:ekd:002625:3036
    as

    Download full text from publisher

    File URL: https://ecomod.net/system/files/leimbach_paper.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Barro, Robert J & Mankiw, N Gregory & Sala-i-Martin, Xavier, 1995. "Capital Mobility in Neoclassical Models of Growth," American Economic Review, American Economic Association, vol. 85(1), pages 103-115, March.
    2. Lucas, Robert E, Jr, 1990. "Why Doesn't Capital Flow from Rich to Poor Countries?," American Economic Review, American Economic Association, vol. 80(2), pages 92-96, May.
    3. Manne, Alan & Mendelsohn, Robert & Richels, Richard, 1995. "MERGE : A model for evaluating regional and global effects of GHG reduction policies," Energy Policy, Elsevier, vol. 23(1), pages 17-34, January.
    4. Thijs ten Raa & Pierre Mohnen, 2009. "The Location of Comparative Advantages on the Basis of Fundamentals Only," World Scientific Book Chapters, in: Input–Output Economics: Theory And Applications Featuring Asian Economies, chapter 23, pages 425-446, World Scientific Publishing Co. Pte. Ltd..
    5. Marian Leimbach, Nico Bauer, Lavinia Baumstark, Michael Luken and Ottmar Edenhofer, 2010. "Technological Change and International Trade - Insights from REMIND-R," The Energy Journal, International Association for Energy Economics, vol. 0(Special I).
    6. Yvan Lengwiler, 2005. "Heterogeneous Patience and the Term Structure of Real Interest Rates," American Economic Review, American Economic Association, vol. 95(3), pages 890-896, June.
    7. Copeland, Brian R. & Taylor, M. Scott, 2005. "Free trade and global warming: a trade theory view of the Kyoto protocol," Journal of Environmental Economics and Management, Elsevier, vol. 49(2), pages 205-234, March.
    8. Weber, Christopher L. & Peters, Glen P., 2009. "Climate change policy and international trade: Policy considerations in the US," Energy Policy, Elsevier, vol. 37(2), pages 432-440, February.
    9. Francesc Obiols-Homs, 2011. "On borrowing limits and welfare," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 14(2), pages 279-294, April.
    10. Stiglitz, Joseph E, 1970. "Factor Price Equalization in a Dynamic Economy," Journal of Political Economy, University of Chicago Press, vol. 78(3), pages 456-488, May-June.
    11. Maurice Obstfeld & Kenneth Rogoff, 2001. "The Six Major Puzzles in International Macroeconomics: Is There a Common Cause?," NBER Chapters, in: NBER Macroeconomics Annual 2000, Volume 15, pages 339-412, National Bureau of Economic Research, Inc.
    12. Bliss, Christopher, 2004. "Koopmans recursive preferences and income convergence," Journal of Economic Theory, Elsevier, vol. 117(1), pages 124-139, July.
    13. Andries Hof & Michel Elzen & Detlef Vuuren, 2010. "Including adaptation costs and climate change damages in evaluating post-2012 burden-sharing regimes," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 15(1), pages 19-40, January.
    14. Nordhaus, William D & Yang, Zili, 1996. "A Regional Dynamic General-Equilibrium Model of Alternative Climate-Change Strategies," American Economic Review, American Economic Association, vol. 86(4), pages 741-765, September.
    15. Das, Mausumi, 2003. "Optimal growth with decreasing marginal impatience," Journal of Economic Dynamics and Control, Elsevier, vol. 27(10), pages 1881-1898, August.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Leimbach Marian & Baumstark Lavinia & Luderer Gunnar, 2015. "The Role of Time Preferences in Explaining the Long-Term Pattern of International Trade," Global Economy Journal, De Gruyter, vol. 15(1), pages 83-106, March.
    2. Marian Leimbach & Nico Bauer, 2022. "Capital markets and the costs of climate policies," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 24(3), pages 397-420, July.
    3. Leimbach, Marian & Baumstark, Lavinia, 2010. "The impact of capital trade and technological spillovers on climate policies," Ecological Economics, Elsevier, vol. 69(12), pages 2341-2355, October.
    4. Marian Leimbach & Anselm Schultes & Lavinia Baumstark & Anastasis Giannousakis & Gunnar Luderer, 2017. "Solution algorithms for regional interactions in large-scale integrated assessment models of climate change," Annals of Operations Research, Springer, vol. 255(1), pages 29-45, August.
    5. Verdier, Genevieve, 2008. "What drives long-term capital flows A theoretical and empirical investigation," Journal of International Economics, Elsevier, vol. 74(1), pages 120-142, January.
    6. Leimbach, Marian & Edenhofer, Ottmar, 2007. "Technological spillovers within multi-region models: Intertemporal optimization beyond the Negishi approach," Economic Modelling, Elsevier, vol. 24(2), pages 272-294, March.
    7. Alogoskoufis, George, 2021. "Asymmetries of financial openness in an optimal growth model," The Journal of Economic Asymmetries, Elsevier, vol. 23(C).
    8. Marian Leimbach & Klaus Eisenack, 2009. "A Trade Algorithm for Multi-Region Models Subject to Spillover Externalities," Computational Economics, Springer;Society for Computational Economics, vol. 33(2), pages 107-130, March.
    9. Ridhwan, M.M. & Nijkamp, P. & Rietveld, P., 2008. "Regional development and monetary policy : a review of the role of monetary unions, capital mobility and locational effects," Serie Research Memoranda 0007, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
    10. Chen, W.T. & Li, Y.P. & Huang, G.H. & Chen, X. & Li, Y.F., 2010. "A two-stage inexact-stochastic programming model for planning carbon dioxide emission trading under uncertainty," Applied Energy, Elsevier, vol. 87(3), pages 1033-1047, March.
    11. Gunter Stephan & Georg M ller-F rstenberger, 2003. "Does Distribution Matter? When Flexibility, Equity and Efficiency in Greenhouse Gas Abatement," Diskussionsschriften dp0301, Universitaet Bern, Departement Volkswirtschaft.
    12. Shiran Victoria Shen, 2021. "Integrating Political Science into Climate Modeling: An Example of Internalizing the Costs of Climate-Induced Violence in the Optimal Management of the Climate," Sustainability, MDPI, vol. 13(19), pages 1-24, September.
    13. Leilane de Freitas Rocha Cambara & Roberto Meurer, 2023. "News sentiment and foreign portfolio investment in Brazil," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 28(3), pages 3332-3348, July.
    14. Herrmann, Sabine & Kleinert, Jörn, 2014. "Lucas paradox and allocation puzzle: Is the euro area different?," Discussion Papers 06/2014, Deutsche Bundesbank.
    15. Rustam Jamilov, 2013. "J-Curve Dynamics and the Marshall–Lerner Condition: Evidence from Azerbaijan," Transition Studies Review, Springer;Central Eastern European University Network (CEEUN), vol. 19(3), pages 313-323, February.
    16. Adrian Penalver, 2003. "Capital flows to emerging markets," Bank of England working papers 183, Bank of England.
    17. Heathcote, Jonathan & Perri, Fabrizio, 2014. "Assessing International Efficiency," Handbook of International Economics, in: Gopinath, G. & Helpman, . & Rogoff, K. (ed.), Handbook of International Economics, edition 1, volume 4, chapter 0, pages 523-584, Elsevier.
    18. Roberto Roson & Martina Sartori, 2016. "Estimation of Climate Change Damage Functions for 140 Regions in the GTAP 9 Database," Journal of Global Economic Analysis, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, vol. 1(2), pages 78-115, December.
    19. Sposi, Michael, 2022. "Demographics and the evolution of global imbalances," Journal of Monetary Economics, Elsevier, vol. 126(C), pages 1-14.
    20. Yongsung Chang & Sun-Bin Kim & Jaewoo Lee, 2013. "Accounting for Global Dispersion of Current Accounts," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 16(3), pages 477-496, July.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ekd:002625:3036. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Theresa Leary (email available below). General contact details of provider: https://edirc.repec.org/data/ecomoea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.