IMF Working Papers

Trade in Low Carbon Technologies: The Role of Climate and Trade Policies

By Samuel Pienknagura

March 29, 2024

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Format: Chicago

Samuel Pienknagura. Trade in Low Carbon Technologies: The Role of Climate and Trade Policies, (USA: International Monetary Fund, 2024) accessed November 12, 2024

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Summary

Curbing carbon emissions to meet the targets set in the Paris Agreement requires the deployment of low carbon technologies (LCTs) at a global scale. This paper assesses the role of climate and trade policies in fostering LCT diffusion through trade. Leveraging a comprehensive database of climate policies and a new database identifying trade in low carbon technologies and the tariffs applied to these goods, this paper shows that the introduction of new climate policies has a positive and significant impact on LCT imports. Zooming into specific climate policies, the paper finds that, except for non-binding ones, all climate policies stimulate LCT imports. The paper also highlights the role of trade policies as an engine of LCT diffusion—reductions in tariffs applied on LCT goods have a sizeable impact on LCT imports. On the flip side, results suggest that more protectionist measures would impede the spread of low-carbon technologies.

Subject: Climate change, Climate policy, Environment, Imports, International trade, Tariffs, Taxes, Trade policy

Keywords: Climate change, Climate policies, Climate policy, Deployment of low carbon technologies, Global, Imports, LCT diffusion, LCT import, Low carbon technologies, Policy portfolio, Role of trade policies, Tariffs, Technological diffusion., Trade, Trade policy

Publication Details

  • Pages:

    30

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Working Paper No. 2024/075

  • Stock No:

    WPIEA2024075

  • ISBN:

    9798400271083

  • ISSN:

    1018-5941