Although conventional wisdom suggests that poor countries are more likely to bear a disproportionate burden of a worldwide carbon tax on fossil fuels used for electricity and transportation, the potential consequences of such a tax would vary depending on several factors, says new research co-written by a University of Illinois energy and environmental policy expert.
Although conventional wisdom suggests that poor countries are more likely to bear a disproportionate burden of a worldwide carbon tax on fossil fuels used for electricity and transportation, the potential consequences of such a tax would vary depending on several factors, says new research co-written by a University of Illinois energy and environmental policy expert.
A global carbon tax or mandate would create new sets of economic winners and losers within each group of countries at different levels of per capita income, said Don Fullerton, a Gutgsell Professor of Finance at Illinois and former deputy assistant secretary of the U.S. Treasury Department.
“With any sort of worldwide carbon policy, low-income countries are afraid that all the burdens are going to fall on them,” Fullerton said. “But the consequences are not all that clear-cut. What we find is that there are going to be winners and losers among rich countries, poor countries and middle-income countries.
Read more at University of Illinois at Urbana-Champaign
Photo: A global carbon tax would create new sets of economic winners and losers, with some countries holding a distinct competitive advantage over others, says new research from Don Fullerton, a Gutgsell Professor of Finance at Illinois and a scholar at the Institute of Government and Public Affairs. Photo by Institute of Government and Public Affairs
