On The Effectiveness Of Carbon-Motivated Border Tax Adjustments

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Executive Summary

As governments consider commitments to reduce carbon emissions, an accompanying question is what adjustments are appropriate to counteract any competitive disadvantage to domestic producers resulting from such commitments, particularly in the European Union, the United States and other organisation for economic co-operation and Development countries. Considering the widely diverging levels of commitments in the area of carbon reductions, many specialists consider that some form of remedy is reasonable in order to maintain the competitiveness of domestic industries.

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