Potential Effects of the Eu's Carbon Border Adjustment Mechanism on the Turkish Economy

dc.authorid Yeldan, A Erinc/0000-0002-3123-4374
dc.authorid Acar, Sevil/0000-0001-5535-8673
dc.authorid Acar, Sevil/0000-0001-5535-8673
dc.authorid Asici, Ahmet Atil/0000-0002-5067-6143
dc.authorwosid Yeldan, A Erinc/AAA-4707-2022
dc.authorwosid Acar, Sevil/AAM-4824-2021
dc.authorwosid Acar, Sevil/N-7478-2017
dc.authorwosid Asici, Ahmet Atil/C-6612-2013
dc.contributor.author Acar, Sevil
dc.contributor.author Yeldan, Alp Erinç
dc.contributor.author Asici, Ahmet Atil
dc.contributor.author Yeldan, A. Erinc
dc.contributor.other Economics
dc.date.accessioned 2023-10-19T15:12:37Z
dc.date.available 2023-10-19T15:12:37Z
dc.date.issued 2022
dc.department-temp [Acar, Sevil] Bogazici Univ, Istanbul, Turkey; [Asici, Ahmet Atil] Istanbul Tech Univ, Istanbul, Turkey; [Yeldan, A. Erinc] Kadir Has Univ, Istanbul, Turkey en_US
dc.description.abstract In December 2019, the EU announced the European Green Deal (EGD) to create a climate-neutral continent by 2050. Accordingly, the EU Emission Trading System (ETS) will be revised to maintain economic growth against possible losses in competitiveness, leading to carbon leakage. Carbon border adjustment (CBA) is one of the mechanisms proposed to tackle the carbon leakage problem. In this paper, we provide a first-order estimate of the potential impacts of a possible CBA across production sectors and build a dynamic, multi-sectoral applied general equilibrium (AGE) model to study the overall macroeconomic impact of the EGD on the Turkish economy. Then, we extend our analysis to document the potential benefits of a more active climate policy. The model is in the Walrasian tradition wherein aggregate supply and demand actions are simulated with the interplay of relative prices to bring equilibrium in the markets for goods, for labor, and for foreign exchange. Constructed around 24 production sectors, the model accommodates flexible, multi-level functional forms to link production activities with gaseous emissions, a government entity to maintain taxation, and public expenditures, as well as administration of environmental policy instruments, all within an open-economy macroeconomic environment. Our results suggest that the potential adverse impact of the CBA on the Turkish economy would range between 2.7 and 3.6% loss of the GDP by 2030 over the business-as-(un)usual base path. We also document that under an alternative scenario through which Turkey is modeled as an active agent in the international climate policy arena embedding decarbonization into her official macroeconomic policy agenda, she can achieve a superior pathway for national income and a reduced carbon burden. en_US
dc.identifier.citationcount 16
dc.identifier.doi 10.1007/s10668-021-01779-1 en_US
dc.identifier.endpage 8194 en_US
dc.identifier.issn 1387-585X
dc.identifier.issn 1573-2975
dc.identifier.issue 6 en_US
dc.identifier.pmid 34483717 en_US
dc.identifier.scopus 2-s2.0-85113940990 en_US
dc.identifier.scopusquality Q1
dc.identifier.startpage 8162 en_US
dc.identifier.uri https://doi.org/10.1007/s10668-021-01779-1
dc.identifier.uri https://hdl.handle.net/20.500.12469/5493
dc.identifier.volume 24 en_US
dc.identifier.wos WOS:000691629800005 en_US
dc.khas 20231019-WoS en_US
dc.language.iso en en_US
dc.publisher Springer en_US
dc.relation.ispartof Environment Development and Sustainability en_US
dc.relation.publicationcategory Makale - Uluslararası Hakemli Dergi - Kurum Öğretim Elemanı en_US
dc.rights info:eu-repo/semantics/openAccess en_US
dc.scopus.citedbyCount 40
dc.subject European green deal en_US
dc.subject Carbon border adjustment en_US
dc.subject Turkey en_US
dc.subject Growth
dc.subject Input-output methodology en_US
dc.subject Growth En_Us
dc.subject Applied general equilibrium en_US
dc.title Potential Effects of the Eu's Carbon Border Adjustment Mechanism on the Turkish Economy en_US
dc.type Article en_US
dc.wos.citedbyCount 33
dspace.entity.type Publication
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