Assessing the Economic Implications of Global Mitigation Efforts and International Market Mechanism Based on a Global Computable General Equilibrium Analysis

• Published in: 자원환경경제연구, 33(4) pp. 439 - 470
• Main Authors: 문종우, 김용건, 김재완
• Format: Journal Article
• Language: English
• Published: 한국환경경제학회 01.12.2024
• Subjects: 경제학
• ISSN: 1229-9146; 2765-5253
• DOI: 10.15266/KEREA.2024.33.4.439

It is crucial to decouple economic growth from greenhouse gas emissions in economies to limit the global warming below 2-degree and achieve the Net Zero. Accordingly, there is an urgent call for assessing the economic impacts of the global mitigation efforts, especially for developing economies. This study applies a recursive dynamic computable general equilibrium model and assesses the economic impacts of the global mitigation efforts and the potential of the International Market Mechanism (IMM). Findings suggest that the economic impacts of the global mitigation efforts could be limited compared to their impacts on CO2 emissions reductions. The changes in the real GDP relative to the BAU level differ by region and scenario. The changes in the real GDI are generally more favorable than those in real GDP across most regions, and the IMM brings some benefits in real GDI in all regions. This study acknowledges the potential of the IMM in achieving the global mitigation targets, with a particular emphasis on the likelihood of more substantial benefits for developed regions. This implies the need for financial supports, technology transfer, and capacity building for developing region to incentivize their participation in the IMM, with a more equitable sharing of the gains from carbon trading. KCI Citation Count: 0