Environmental Taxation in Energy Sector - A Theoretical and Applied Analysis

A global multi-sectoral, multi-regional computational general equilibrium model is employed to assess carbon taxes under perfect competition and monopoly. We found that regional studies of carbon taxation maybe inaccurate due to the carbon emission spillover effects. Emission taxes have stronger impacts on the economy in monopoly rather than on perfect competition in terms of magnitude. Carbon emission tax policy analysis which is based on perfect competition may also underestimate the losses of welfare compared with the case in imperfect competition.