A General Equilibrium Analysis of Greenhouse Gas Mitigationand Income Distribution

• Main Authors: Chien-Hua Yeh, 葉鍵樺
• Other Authors: Shih-Mo Lin
• Format: Others
• Language: en_US
• Published: 2016
• Online Access: http://ndltd.ncl.edu.tw/handle/28708761876755942761

碩士 === 中原大學 === 國際經營與貿易研究所 === 105 === In response to global climate change, greenhouse gas reduction is an issue that has attracted close attention from governments around the world. To evaluate the effects of greenhouse gas reduction in Taiwan, this study aims to construct a computable general equilibrium model that covers detailed income distribution mechanism and estimates the impact of five types of reduction situations on general economy and income distribution in Taiwan. A survey on household income and expenditure from the directorate general of the budget, accounting, and statistics stated that the household accounting sector is divided into 10 sections, and income sources and expenditure items of all sections are sorted out. This study simulates 25 million metric tons reduced from CO2 emissions with the carbon tax as an economic tool. Tax revenue increases government spending, enables income tax deduction for lower-income sectors, and facilitates revenue transfer to the household sector. Based on the idea that part of governmental tax revenue is transferred to the household accounting section, the simulation result of greenhouse gas reduction in this study differs from the findings reported in most previous literature. The income distribution shows a progressive situation. In the aspect of policy implications, if the improvement of income distribution is emphasized, this paper suggests increasing the part of tax revenue that is transferred to the household section, and the financial burden from the price increase of energy products must be reduced. If the economic growth is maintained in the reduction, more tax revenue should be used in government spending to expand domestic demand and revitalize the economy.