Trade in Low Carbon Technologies: The Role of Climate and Trade Policies
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Summary:
Curbing carbon emissions to meet the targets set in the Paris Agreement requires the deployment of low carbon technologies (LCTs) at a global scale. This paper assesses the role of climate and trade policies in fostering LCT diffusion through trade. Leveraging a comprehensive database of climate policies and a new database identifying trade in low carbon technologies and the tariffs applied to these goods, this paper shows that the introduction of new climate policies has a positive and significant impact on LCT imports. Zooming into specific climate policies, the paper finds that, except for non-binding ones, all climate policies stimulate LCT imports. The paper also highlights the role of trade policies as an engine of LCT diffusion—reductions in tariffs applied on LCT goods have a sizeable impact on LCT imports. On the flip side, results suggest that more protectionist measures would impede the spread of low-carbon technologies.
Series:
Working Paper No. 2024/075
Subject:
Climate change Climate policy Environment Imports International trade Tariffs Taxes Trade policy
Frequency:
regular
English
Publication Date:
March 29, 2024
ISBN/ISSN:
9798400271083/1018-5941
Stock No:
WPIEA2024075
Format:
Paper
Pages:
30
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