Abstract
Incorporating environmental regulation and its impact in general equilibrium models has by now a twenty years long tradition. In 1970, Leontief extended his input-output approach to quantify environmental repercussions on the economic structure. The shortcomings of this model, such as fixed coefficients in technological processes or zero price and income elasticities of demand, can be resolved by using a quantitative general equilibrium model. The objective of this paper is to employ such a model to quantify the economic effects of environmental policy and to present a cost-effectiveness analysis of different market instruments in environmental policy.
Similar content being viewed by others
References
P.S. Armington, A theory of demand for products distinguished by place of production, Int. Monetary Staff Papers 16(1969)159–178.
L. Bergman, Energy and environmental constraints on growth: A CGE modeling approach, J. Policy Mod. 12(1990)671–691.
L. Bergman, General equilibrium effects of environmental policy: A CGE modeling approach, Env. Resources Econ. 1(1991)67–85.
J.-M. Burniaux, J.P. Martin, G. Nicoletti and J.O. Martins, The cost of reducing CO2 emissions: Evidence from GREEN, OECD Working Paper No. 115 (1992).
J.-M. Burniaux, J.P. Martin, G. Nicoletti and J.O. Martins, GREEN: A multi-sector, multi-region general equilibrium model for quantifying the costs of curbing CO2 emissions: A technical manual, OECD Working Paper No. 116 (1992).
K. Conrad, Die Anpassung der Volkswirtschaft beim Übergang zu neuen Energieversorgungssystemen: Die theoretischen Grundlagen eines Energimodells für die Bundesrepublik Deutschland, in:Reaktionen auf Energiepreissteigerungen, ed. H. Siebert (Lang, Frankfurt, 1982) pp. 1–37.
K. Conrad and I. Henseler-Unger, Applied general equilibrium modelling for long-term energy policy in the Fed. Rep. of Germany, J. Policy Mod. 8(1986)531–549.
K. Conrad and M. Schröder, An evaluation of taxes on air pollutants emission: An AGE approach, Schweiz. Zeits. Volkswirtschaft und Statistik 127(1991)199–224.
K. Conrad and M. Schröder, The control of CO2 emissions and its economic impact, Env. Resource Econ. 1(1991)289–312.
K. Conrad and M. Schröder, Controlling air pollution: The effect of alternative policy approaches, in:Environmental Scarcity: The International Dimension, ed. H. Siebert (Tübingen, 1991) pp. 35–53.
E.A. Hudson and D.W. Jorgenson, Energy policy and economic growth, 1975–2000, Bell. J. Econ Manag. Sci. 5(1974)461–514.
L. Johanson,A Multisectoral Study of Economic Growth (North-Holland, Amsterdam, 1979).
D.W. Jorgenson and P.J. Wilcoxen, Environmental regulation and US economic growth, Rand. J. Econ. 21(1990)314–340.
D.W. Jorgenson and P.J. Wilcoxen, Intertemporal general equilibrium modeling of US environmental regulation, J. Policy Mod. 12(1990)715–744.
D.W. Jorgenson and P.J. Wilcoxen, Reducing US carbon dioxide emissions: The cost of different goals, in:Energy, Growth, and Environment: Advances in the Economics of Energy and Resources, vol. 7 (JAI Press, 1992) pp. 125–158.
J. Schumann, On some basic issues of input-output economics: Technical structure, prices, imputations, structural decomposition, applied general equilibrium, Econ. Syst. Res. 2(1990)229–239.
M. Schröder,Die volkswirtschaftlichen Kosten von Umweltpolitik. Kosten-Wirksamkeitsanalysen mit einem angewandten Gleichgewichtsmodell, Dissertation (Physika-Verlag, Heidelberg, 1991).
J.B. Shoven and J. Whalley, AGE models of taxation and international trade: An introduction and survey, J. Econ. Literature 22(1984)1007–1051.
F. Wirl, Impact of environmental regulation on economic activity — Austria, Empirica 16(1989)209–233.
Author information
Authors and Affiliations
Rights and permissions
About this article
Cite this article
Conrad, K. Applied general equilibrium modeling for environmental policy analysis. Ann Oper Res 54, 129–142 (1994). https://doi.org/10.1007/BF02031731
Issue Date:
DOI: https://doi.org/10.1007/BF02031731