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Paving the Way to Sustainability: Assessing the Impacts of Carbon Border Tariffs on the Steel Industry

Spanier, Claudia LU and Rahmanian Aberouie, Kimya LU (2023) NEKN01 20231
Department of Economics
Abstract
This paper seeks to provide insights into the effects of carbon border tariffs and to offer guidance for policymakers. The focus is directed towards the steel sector - a major contributor to carbon dioxide emissions, where production practices vary significantly among countries, leading to differences in pollution levels. Our primary focus is on the proposed carbon border tariff by the United States, which aims to extend its reach to the EU as well. To investigate this topic, the structural gravity model is employed, which is a widely used model for assessing the effects of policy measures on trade flows. Our findings highlight the effectiveness of steel tariffs in reducing imports, which potentially can redirect production and contribute... (More)
This paper seeks to provide insights into the effects of carbon border tariffs and to offer guidance for policymakers. The focus is directed towards the steel sector - a major contributor to carbon dioxide emissions, where production practices vary significantly among countries, leading to differences in pollution levels. Our primary focus is on the proposed carbon border tariff by the United States, which aims to extend its reach to the EU as well. To investigate this topic, the structural gravity model is employed, which is a widely used model for assessing the effects of policy measures on trade flows. Our findings highlight the effectiveness of steel tariffs in reducing imports, which potentially can redirect production and contribute to a reduction of CO2 emissions. Additionally, it can alter trade patterns and address the concern of carbon leakage. Furthermore, the elasticities vary among steel products. Hence, considering different taxation levels depending on the steel product could be recommended in order to achieve the desired outcome. (Less)
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author
Spanier, Claudia LU and Rahmanian Aberouie, Kimya LU
supervisor
organization
course
NEKN01 20231
year
type
H1 - Master's Degree (One Year)
subject
keywords
Carbon border tariffs, CO2 emissions, trade, steel, environmental policy
language
English
id
9135799
date added to LUP
2023-09-12 15:38:33
date last changed
2023-09-12 15:38:33
@misc{9135799,
  abstract     = {{This paper seeks to provide insights into the effects of carbon border tariffs and to offer guidance for policymakers. The focus is directed towards the steel sector - a major contributor to carbon dioxide emissions, where production practices vary significantly among countries, leading to differences in pollution levels. Our primary focus is on the proposed carbon border tariff by the United States, which aims to extend its reach to the EU as well. To investigate this topic, the structural gravity model is employed, which is a widely used model for assessing the effects of policy measures on trade flows. Our findings highlight the effectiveness of steel tariffs in reducing imports, which potentially can redirect production and contribute to a reduction of CO2 emissions. Additionally, it can alter trade patterns and address the concern of carbon leakage. Furthermore, the elasticities vary among steel products. Hence, considering different taxation levels depending on the steel product could be recommended in order to achieve the desired outcome.}},
  author       = {{Spanier, Claudia and Rahmanian Aberouie, Kimya}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{Paving the Way to Sustainability: Assessing the Impacts of Carbon Border Tariffs on the Steel Industry}},
  year         = {{2023}},
}