Carbon leakage: pollution, trade or politics?
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In recent years, carbon leakage has attracted widespread attention from both environmental researchers and a broader public. Despite its popularity, there has been some confusion around the concept of carbon leakage, resulting from very different and sometimes imprecise definitions of a phenomenon that can be calculated using different, outcome–relevant methods. The aim of the present article is to bring clarity to this research field, to classify available definitions and to offer specific recommendations for good practice. In particular, we discuss and compare different understandings of carbon leakage and the methodologies used to calculate them. Our analysis highlights crucial differences with respect to diverse research purposes and points out shortcomings and potential problems that may, in extreme cases, create policy-relevant grey areas.
KeywordsCarbon leakage Environmental policy Emission transfers Multi-regional input–output analysis (MRIO) Emissions embodied in bilateral trade (EEBT)
We would like to thank Glen Peters, Edgar Hertwich and Kirsten Wiebe for insightful information and comments.
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