TY - BOOK ID - 146594279 TI - Cross-Border Impacts of Climate Policy Packages in North America AU - Fournier, Jean-Marc. AU - Kass-Hanna, Tannous. AU - Masterson, Liam. AU - Paret, Anne-Charlotte. AU - Thube, Sneha. PY - 2024 SN - 9798400272004 PB - Washington, D.C. : International Monetary Fund, DB - UniCat KW - Carbon tax KW - Climate policy KW - Climate KW - Commodities KW - Currency crises KW - Economic & financial crises & disasters KW - Economics of specific sectors KW - Economics KW - Economics: General KW - Electric Utilities KW - Electric utilities KW - Electricity KW - Emissions trading KW - Energy and the Macroeconomy KW - Energy: Government Policy KW - Environment KW - Environmental Economics KW - Environmental economics KW - Environmental Economics: Government Policy KW - Environmental impact charges KW - Environmental policy & protocols KW - Environmental Policy KW - Environmental policy KW - Environmental Taxes and Subsidies KW - Financial Markets and the Macroeconomy KW - Global Warming KW - Informal sector KW - International finance KW - Investment & securities KW - Investments: Energy KW - Macroeconomics KW - Mathematical Methods and Programming: General KW - Natural Disasters and Their Management KW - Public finance & taxation KW - Redistributive Effects KW - Taxation and Subsidies: Externalities KW - Taxation KW - Taxation, Subsidies, and Revenue: General KW - Taxes KW - Trade and Environment UR - https://www.unicat.be/uniCat?func=search&query=sysid:146594279 AB - We quantify cross-border effects of the recent climate mitigation policies introduced in Canada and the U.S., using the global general equilibrium model IMF-ENV. Notably, with the substantial emission reductions from Canada’s carbon tax-led mitigation policies and the U.S.’ Inflation Reduction Act, these two countries would bridge two-thirds of the gap toward their Nationally Determined Contribution (NDC) goals. While the broadly divergent policies are believed to elicit competitiveness concerns, we find the aggregate cross-border effects within North America to be very limited and restricted to the energy intensive and trade exposed industries. Potential carbon leakages are also found to be negligible. A more meaningful difference triggered by policy heterogeneity is rather domestic, especially with U.S. subsidies increasing energy output while the Canada model with a carbon tax would marginally decrease it. This analysis is complemented by a stylized model illustrating how such divergence can affect the terms of trade, but also how these effects can be countered by exchange rate flexibility, border adjustments or domestic taxation. ER -