General Equilibrium Effects of Carbon Offsets
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摘要
This paper develops an analytical general equilibrium model to study carbon offsets, revealing that increasing offset prices can have ambiguous effects on aggregate emissions and welfare. It shows offsets can be over-credited or under-credited due to economy-wide spillovers, and introduces four margins of adjustment (including a newly identified one) by which offsets respond to payments. The study defines conventional and aggregate carbon accounting, demonstrating their divergent implications for welfare and emissions, and highlights potential backfire scenarios in general equilibrium. Policy implications stress the importance of market spillovers when evaluating offsets and suggest MVPF as a welfare-relevant metric over conventional accounting [page::0][page::1].
