摘要：This paper employs analytical and numerical general equilibrium models to assess theefficiency impacts of two policies to reduce U.S. carbon emissions – a revenue-neutral carbontax and a non-auctioned carbon quota – taking into account the interactions between thesepolicies and pre-existing tax distortions in factor markets. We show that tax interactionssignificantly raise the costs of both policies relative to what they would be in a first-bestsetting. In addition, we show that these interactions put the carbon quota at a significantefficiency disadvantage relative to the carbon tax: for example, the costs of reducingemissions by 10 percent are more than three times as high under the carbon quota as under thecarbon tax. This disadvantage reflects the inability of the quota policy to generate revenuethat can be used to reduce pre-existing distortionary taxes.Indeed, second-best considerations can limit the potential of a carbon quota togenerate overall efficiency gains. Under our central values for parameters, a non-auctionedcarbon quota (or set of grandfathered carbon emissions permits) cannot increase efficiencyunless the marginal benefits from avoided future climate change are at least $17.8 per ton ofcarbon abatement. Most estimates of marginal environmental benefits are below this level.Thus, our analysis suggests that any carbon abatement by way of a non-auctioned quota willreduce efficiency. In contrast, our analysis indicates that a revenue-neutral carbon tax can beefficiency-improving so long as marginal environmental benefits are positive.
