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How will trade affect carbon leakage? : the impact of bilateral US Canada trade flows on Canadian Kyoto emissions targets

University of British Columbia

This thesis will be examining whether differences in environmental policies between two trading partners, Canada and the US impact the effectiveness of the environmental policy of the trading partner who employs the policy. Specifically, Canada's emissions reductions under the Kyoto Accord are examined to determine whether non participation of the US will lead to a trade induced carbon leakage affect that will reduce the level of greenhouse gas reductions that Canada undertakes. A computational general equilibrium model is used and a sectoral comparison of Canadian and US sectors in emissions intensity is done. Three scenarios are examined: 1) all countries achieve their Kyoto targets with no international permit trading scheme and no US participation 2) all countries achieve their Kyoto targets with an international permit trading scheme in place and no US participation 3) all countries achieve their Kyoto targets with an international permit trading scheme in place but the number of permits are restricted and there is no US participation in the Kyoto Accord. It is found that trade with the US will have a minimal to no impact on Canada's reduction commitment under all three scenarios.

Thesis/Dissertation

application/pdf

2009-11-17

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http://hdl.handle.net/2429/15185

Agricultural Economics

University of British Columbia

UBCV

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