The Australian Government introduced a carbon tax from 1 July 2012. The then opposition party leader, now Prime Minister, introduced legislation to repeal the tax. Amongst the many issues being debated is that of the incidence of the tax. In this study, we explore household consumption and income changes arising from a A$23 carbon price employing a computable general equilibrium model (entitled A3E-G). The model has been calibrated using a social accounting matrix database of Australia with 10 household income groups. This carbon price generates A$6.39 billion revenue while reducing Australia's carbon emissions by 11%. The empirical evidence suggests household level impacts range from proportional to mildly progressive tax incidence. In this study, we propose four revenue recycling options to overcome any undesirable distributional effects from the carbon price. Results indicate that revenue recycling through income tax reductions and uniform lump sum transfers improves post tax income levels and welfare towards middle and high income groups. A nonuniform lump sum transferring option favors low income households. Uniform reductions in commodity tax rates are not found to be welfare improving but we find positive impacts on export competitiveness from this option.

The paper employs a computable general equilibrium (CGE) model with an environmentally-extended Social Accounting Matrix (SAM) to simulate the effects of a carbon tax of $23 per tonne of carbon dioxide on different economic agents, with and without a compensation policy. According to the simulation results, the carbon tax can cut emissions effectively, but will cause a mild economic contraction. The proposed compensation plan has little impact on emission cuts while significantly mitigating the negative effect of a carbon tax on the economy. The effect on various employment occupations is mildly negative, ranging from -0.6% to -1.7%, with production and transport workers worst affected.

The objective of this study is to describe the construction of a Social Accounting Matrix (SAM) for Australia. This environmentally focused SAM appears to be one of the first for Australia. A SAM differs from an input-output table database in that it includes the important inter-industry matrix of the input-output table, but also adds details on the institutions in the economy. The institutions presented in this SAM are households, government, corporations and rest of the world (ROW). The particular policy change for which this SAM is designed is the imposition of a carbon tax. The production sectors of the economy are disaggregated into 35 sectors to be compatible with the estimates of carbon emissions in Australia. The SAM being described in this study further disaggregates the household sector into ten deciles in order to provide scope to analyse the distributive and redistributive aspects of a policy change. Furthermore, labour is disaggregated into nine employment groups which facilitate an in depth analysis of the impact of the tax on the different employment. The SAM developed here is being used in an environmentally extended CGE model to analyse macroeconomic and sectoral impacts of a carbon tax in Australia.

A stable supply of electricity at an affordable cost is indispensable for sustainable national economic growth and security. Stable power supply directly affects the structure of national industry and indirectly influences economic conditions and social welfare. Japan had considered nuclear power an "efficient base-load power source". Nuclear power plants were once able to supply more than 25% of the Japanese domestic electricity demand. However, due to the Fukushima Daiichi nuclear disaster, Japan shut down all its’ existing nuclear plants for safety assessment. Consequently, imports of fossil fuels for thermal power generation increased and electricity prices rose. Citizens have had to bear a further invisible economic burden due to the rise in electricity prices precipitated by the FiT (Feed-in tariffs) policy, as implemented after the nuclear shutdown. The purpose of this thesis is to analyse the impact of the nuclear shutdown and the effects of FiT policy in order to provide practical advice on current and future power policies.

A multi-sector, multi-electricity generation technology, Computable General Equilibrium (CGE) model is used to provide the evidence for the electricity supply problems. This CGE model captures the interdependence among markets in the determination of both prices of commodities and factors of productions as well as the impact of policy decisions on the electricity supply system. As a departure from previous literature relating to CGE analysis of energy policy, a precise disaggregation of electricity generation technology allows for significantly more accurate estimates of the industry activity impact than previously achieved, through elucidating the complexity of substitution effects among electricity generation technologies.

The study reveals that the impact of the nuclear shutdown is to raise electricity prices and which then has an adverse effect on the economy. The main finding from the nuclear shutdown study shows that electricity-intensive industries or industries with high price competition are vulnerable to the electricity price fluctuations. The study also found the decline of domestic industries and the rise in electricity charges cause a decline in real income and adversely affect the service industry. The finding from the FiT policy study reveals that the policy worsened most aspects of the economic situation due to the further rise in electricity price, but it does limitedly improve the CO2 emission level. However, the main reason for improving CO2 emissions is elucidated as being due to a decrease in demand for all electricity including thermal power, due to economic deterioration.

The detailed results imply a hollowing out of the electric-intensive industries, and the decline in the service sector, with an accompanying loss of employment opportunities and an increase of social security costs. The results also suggest that the rise in electricity price has expanded income disparity from the high reduction rate of the necessities demand of household consumption expenditure for many households. This will be an important point of concern for future policy.

The Australian government has announced to price carbon at an initial price of $23 per tonne. Despite detailed modelling undertaken by the Commonwealth Treasury, there is widespread speculation about the possible economic impact of a carbon tax in Australia. In this paper we build a computable general equilibrium (CGE) model incorporating many new features to deal with the issue of emissions and model the impact of carbon taxes. The analysis undertaken by simulating the impact of a carbon tax of $23 a tonne reveals some interesting outcomes. For example, in the short run, Australia's real GDP may decline by 0.68 percent, consumer prices may rise by 0.75 percent, and the price of electricity may increase by about 26 percent as a result of the tax. Nevertheless it allows Australia to make a substantial cut in its CO₂ emissions. The simulation results imply an emission reduction of about 12 percent in its first year of operation. The tax burden is unequally distributed among different household groups with low-income households carrying a relatively higher burden.

The global financial crisis (GFC) began three years ago, but the world economy is still in its shadow. The sluggishness of the economic recovery in the US and the recurrence of the European debt crises destroys the confidence of investors as well as consumers. "Double dip" appears as a threat from time to time. Under these circumstances, it is imperative to understand fully the impact of the GFC and the effectiveness of various policy responses to it. Using the GTAP model, the GTAP database 7.0 and macroeconomic data, this paper will gauge the impact of the GFC on the Asia-Pacific region. The paper will also simulate and assess the effect of the policy responses in Asia-Pacific countries, such as massive government investment in infrastructure and capital-intensive goods, and tax cuts and subsidies to help business and save jobs. By analyzing the simulation results, this paper will shed light on the contributing factors of the GFC and the efficient ways to cope with a large negative economic shock like the GFC.

Reductions in greenhouse gas emissions are essential to reducing the rate and scale of anthropogenic climate change to levels that can sustain the planet's biosphere. A carbon tax is a policy measure that is designed to reduce greenhouse gas emissions by increasing the prices of the highest carbon polluting goods and services in an economy, thus encouraging substitution towards resultant relatively cheaper and less-polluting goods where possible. When Australia introduced such a tax in 2012, there was a fear that it could threaten the resources boom, considered the engine of Australian economic growth in recent years. By employing a computable general equilibrium model and an environmentally-extended Social Accounting Matrix, this paper demonstrates the effects of a carbon tax on the resources sector. The modelled results show that, in a flexible exchange rate regime, all resources within the sector will be affected negatively but to different degrees. The brown coal sector will be the hardest hit, with a 25.74 per cent decrease in output, 52.94 per cent decrease in employment and 89.37 per cent decrease in profitability. However, other resources in the sector would be only mildly affected. From the point of view of sustainability, the most significant results are that, under the carbon tax, the resources sector contributes considerably to the carbon emission reduction target of Australia. Given that brown coal accounts for only a small portion of the resources sector, it is reasonable to suggest that a carbon tax would not significantly affect the overall performance of the sector.

This paper analyses the macro-economic, sectoral and household effects of an AU$23per tonne carbon price to achieve carbon dioxide (CO2-e) emissions reduction targets in the Australian economy by employing a static computable general equilibrium (titled as A3E-G) model of the Australian Economy. The A3E-G model developed for this study is capable of handling endogenous substitution among energy inputs and alternative allocation of resources among energy and capital. The A3E-G model incorporates an explicit tax system that evaluates carbon price impact on the economy under both short-run and long-run closures. The model has been calibrated using an environmentally-extended social accounting matrix (ESAM) which is disaggregated to show a detailed picture of carbon emissions by sectors, energy sources, electricity generating sectors, household income groups and various occupations.

With the new Australian Government and various interest groups objecting to the Australian carbon tax, public opinion about pricing carbon is divided. Some of the disagreement may be due to misunderstandings about the effects of the policy. In an effort to clarify some of the issues, this article reports the simulated effects of a carbon tax of A$23 per tonne of carbon dioxide on different economic agents, with and without a compensation policy. We employ a computable general equilibrium (CGE) model with an environmentally extended social accounting matrix (SAM). At the sectoral level, brown coal electricity, black coal electricity and the brown coal mining sectors are big losers. The effect on various employment occupations is mildly negative, ranging from -0.6 per cent to -1.7 per cent, with production and transport workers worst affected. According to household utility projections, low-income households suffer more from a carbon tax and benefit more from the proposed compensation policy. However, the commonly used equivalent variation (EV) tends to reverse this conclusion.

The global financial crisis (GFC) began four years ago, but the world economy is still in its shadow. The sluggishness of the economic recovery in the US and the recurrences of the European debt crises destroy the confidence of investors as well as consumers. "Double dip" appears as a threat from time to time. Under these circumstances, it is imperative to understand fully the impact of the GFC and the effectiveness of various policy responses to it. Using the GTAP model, the GTAP database version 7 and macroeconomic data, this paper will gauge the impact of the GFC on emerging markets. The paper also reports the simulation results assessing the effect of policy responses. By analyzing the simulation results, this paper will shed light on the contributing factors of the GFC and the efficient ways to cope with a large negative economic shock like the GFC.