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We study a newsvendor problem with greenhouse gas (GHG) emissions at the disposal stage regulated by a cap-and-trade policy. We first consider a synchronous version of the problem where the replenishment period and the emission assessment period are the same. For this problem, we propose simple algorithms to derive the optimal quantity and cost for both continuous and discrete demand distributions. We show that ignoring the carbon tax may lead to large overcost, especially when the GHG quota is small. For a normally distributed demand, we also show that the demand standard deviation has a non-linear and non-monotonic effect on the order quantity. We then investigate an asynchronous version of the problem where replenishment decisions occur at a higher frequency than the quota allocation. We formulate this lot sizing problem as a Markov decision process and solve it with a dynamic programming algorithm whose complexity is assessed. Through a numerical experimentation and theoretical results, we demonstrate how and when the flexibility of the optimal dynamic replenishment decisions allows to reduce costs. When approaching the end of the time horizon, the uncertainty reduction allows the decision maker to adopt a riskier policy and order larger quantities. [ABSTRACT FROM AUTHOR]

As the EU and the US successively proposed the carbon border adjustment mechanism (CBAM) and the Clean Competition Act (CCA), importers are now required to declare the carbon emissions of their products. Particularly, wheel companies face increasing time pressure with the gradual development of implementation paths for net-zero emissions and implementing carbon pricing policies in various countries. This research uses the production data of Taiwan wheel companies to establish a mathematical model for the activity-based cost optimisation decision-making process. It explores the impact of different carbon emission costs on a company's product mix with pricing decisions. Further, the research proposes five mathematical programmes for single-period cost optimisation decision-making under carbon pricing. These models provide some detailed view, such as changes in profits and product mix caused by high carbon taxes or other changes for each resource. Furthermore, the production cost optimal model proposed in this research can be used by enterprises to fulfill their social responsibilities while ensuring profitability and serve as a reference for making net-zero transformation decisions. [ABSTRACT FROM AUTHOR]

Sweden was one of the first countries to introduce a carbon tax back in 1991. We assemble a unique data set tracking CO2 emissions from Swedish manufacturing firms over 26 years to estimate the impact of carbon pricing on firm-level emission intensities. We estimate an emission-to-pricing elasticity of around two, with substantial heterogeneity across subsectors and firms, where higher abatement costs and tighter financial constraints are associated with lower elasticities. A simple calibration suggests that 2015 CO2 emissions from Swedish manufacturing would have been roughly 30% higher without carbon pricing. [ABSTRACT FROM AUTHOR]

Carbon tax represents governments' approach to steering the economy towards a greener future. Our research question focuses on the impact of carbon tax policy on a firm's production decision and revenue and on total social welfare. In particular, we assume that a firm's decision is subject to its behavioural considerations or, in other words, its risk attitude. We model a government plan to charge a carbon tax, and a risk-averse (or risk-neutral) firm needs to plan its production and estimate its profit if the carbon tax policy is implemented. We show that it is possible for a risk-averse firm's optimal profit, in some cases, to be higher than that of a risk-neutral firm when facing a carbon tax. This implies that the risk-averse attitude is not necessarily harmful to the firm's profit. For operations management scholars, our model highlights the importance of integrating firms' behavioural responses into the carbon tax price. Our model suggests that for governments to implement carbon tax policy effectively, they should make carbon prices vary under certain conditions and not worry about price variation antagonising firms at large. [ABSTRACT FROM AUTHOR]

Fuel cell-battery electric drivetrains are attractive alternatives to reduce the shipping emissions. This research focuses on emission-free cargo vessels and provides insight on the design, lifetime operation and costs of hydrogen-hybrid systems, which require further research for increased utilization. A representative round trip is created by analysing one-year operational data, based on load ramps and power frequency. A low-pass filter controller is employed for power distribution. For the lifetime cost analysis, 14 scenarios with varying capital and operational expenses were considered. The Net Present Value of the retrofitted fuel cell-battery propulsion system can be up to $ 2.2 million lower or up to $ 18.8 million higher than the original diesel mechanical configuration, highly dependent on the costs of green hydrogen and carbon taxes. The main propulsion system weights and volumes of the two versions are comparable, but the hydrogen tank (68 tons, 193 m3) poses significant design and safety challenges. • Selection of a round trip power profile based on load ramps and power frequency. • A real-time low-pass filter-based controller is employed for power distribution. • Lifetime cost estimation, considering degradation, for varying CAPEX and OPEX. • Hydrogen system NPV between $2.2e6 lower and $18.8e6 higher than diesel system NPV. • The LH 2 tank size (68 tons, 193 m3) poses significant design and safety challenges. [ABSTRACT FROM AUTHOR]

Global warming caused by greenhouse gas emissions has become a worldwide environmental problem, posing a great threat to human survival. As the world's largest emitter of carbon dioxide, China has pledged to reach peak carbon emissions by no later than 2030 and carbon neutrality by 2060. It is found that a carbon tax is a powerful incentive to reduce carbon emissions and promote an energy revolution, but it may have negative socio-economic impacts. Therefore, based on China's 2020 input–output table, this paper systematically investigates the impacts of a carbon tax on China's economy, carbon emissions, and energy by applying a computable general equilibrium model to determine the ideal equilibrium between socio-economic and environmental objectives. Based on energy use characteristics, we subdivided the energy sector into five major sectors: coal, oil, natural gas, thermal power generation, and clean power. The results show that when the carbon emission reduction target is less than 15%, that is, when the equilibrium carbon tax price is less than 54 yuan/ton, the implementation of a carbon tax policy can significantly reduce carbon emission and fossil fuel energy consumption, while only slightly reducing economic growth rate, and can achieve the double dividend of environment and economy. Moreover, because the reduction of coal consumption has the greatest impact on reducing carbon emissions, the ad valorem tax rate on coal after the carbon tax is imposed is the highest because coal has the highest carbon emission coefficient among fossil fuels. In addition, as an emerging clean energy source, hydrogen energy is the ideal energy storage medium for achieving clean power generation in power systems. If hydrogen energy can be vigorously developed, it is expected to greatly accelerate the deep decarbonization of power, industry, transportation, construction, and other fields. [ABSTRACT FROM AUTHOR]

Large CO2 emissions constitute a significant problem today due to their effect on climate change, and the need to design appropriate energy policies to mitigate their consequences and reduce emissions requires a detailed analysis of one of the main sources of such emissions: the electricity system. Thus, this paper presents a study on the effects of energy policies on decarbonization by comparing the detailed phase-out of coal-fired power plants across a range of cases with the implementation of a carbon tax to meet Nationally Determined Contributions (NDCs). The case study focuses on the Chilean electricity system, using a long-term generation and transmission expansion planning model (GTEP) that incorporates a wide range of generation technologies. The study examines the long-term effects of these policies, including costs, investments, and CO2 emissions, as well as their impact on consumer prices reflected in the marginal costs of the system. The transmission system modeling covers various regions of Chile and significant projections for renewable energy sources. It evaluates three economic scenarios based on generation technology costs, fuel prices, and electricity demand under four different closure schemes and fourteen different carbon tax levels. The results indicate that implementing a carbon tax can be more cost-effective for the system than the implementation of a phase-out schedule for coal plants, taking the form of reduced CO2 emission and overall system costs, with an optimal carbon tax value of 37 USD/tCO2. Additionally, the study reveals significant effects on consumer prices, showing that a carbon tax as an energy policy leads to lower prices compared to a phase-out scheme. [ABSTRACT FROM AUTHOR]

Effective carbon taxation is essential for achieving the green transition. However, there is typically stiff opposition to carbon taxation due to adverse equity and other impacts. Hence, it is essential to get a better understanding of which factors, including the use of tax revenue, can increase acceptability. To date, stated preference methods, rarely used to analyse this issue, have focused only on households. We conduct two national choice experiment surveys of Norwegian households and companies. The experiments include carbon taxes on transport fuel and associated emission reductions and different revenue recycling options as attributes. We find that both groups are more accepting of higher tax levels if the revenues finance climate change mitigation efforts. There is some heterogeneity among the groups with regard to using revenues to reduce different dimensions of inequality. Simulating policy scenarios, we find acceptance for the highest carbon tax among both groups when the revenues are used both to finance climate change mitigation efforts and to reduce rural-urban inequalities. This policy option points to an acceptable carbon tax close to an estimated level necessary for reaching the most ambitious climate target set by the Norwegian government. In Norway, further research should explore whether an effective carbon tax level could be achieved with modest efficiency loss, while also alleviating inequality. Key policy insights: Policymakers need a better understanding of the factors, including the use of associated tax revenues, that increase carbon tax acceptability in order to ensure that the tax is high enough to effectively reduce emissions. Simultaneously considering levels of carbon tax acceptance among households and companies could increase the chance of implementing higher, more effective carbon tax levels by identifying mutual interests and points of divergence. Our results show that companies and households concur to a certain extent on the most socially acceptable policy option; earmarking carbon tax revenues to finance climate change mitigation efforts and to reduce rural-urban inequalities. [ABSTRACT FROM AUTHOR]

Carbon pricing has emerged as a prominent policy tool to mitigate climate change due to its proclaimed high efficiency and effectiveness. However, the successful and sustainable implementation of carbon pricing also depends on the public acceptability. This paper investigates how revenue recycling shapes public attitudes towards carbon pricing. A systematic literature review identified 48 relevant studies from 2004 to March 2023. Using qualitative content analysis I discern relevant factors and construct a typology of revenue recycling options. Subsequently, a consensus ordinal ranking of revenue recycling options, based on the empirical findings of the reviewed studies, synthesizes current knowledge. The results reveal that revenue recycling has a crucial impact on public acceptability. While environmental earmarking ranks highest, and reducing corporate taxes is the least preferred option, numerous other revenue recycling options lie between these two options. Moreover, the literature presents divergent findings regarding the level of public acceptability of specific revenue recycling options. The diversity of research contexts and designs introduces inherent limitations that may explain variations in rankings observed across different studies. Notably, I identify political trust related to and salience of revenue recycling as important factors affecting public acceptability of carbon pricing. Finally, this research offers a framework for policymakers seeking to design revenue recycling strategies that align with public preferences to implement carbon pricing. KEY POLICY INSIGHTS: Revenue recycling is a critical element of effective carbon pricing mechanisms, as public acceptability depends substantially on how revenues are used. The proposed ranking offers a framework for policymakers to design carbon pricing policies. Environmental earmarking is the most preferred way of revenue recycling, but the acceptability of each revenue recycling option also depends on the specific context. Designing revenue recycling in line with public preferences can enhance public acceptability of carbon pricing policies, and hence, their implementation. Trust, communication and salience of revenue recycling can enhance public acceptability of carbon pricing. [ABSTRACT FROM AUTHOR]

Stringent policies that significantly increase the cost of greenhouse gas emissions, such as CO2$_2$, are increasingly necessary for mitigating climate change. Yet while richer individuals in society generate the most CO2$_2$ emissions and thus will face the largest absolute cost burden, they also tend to be more supportive of stringent environmental policies. In this paper, we examine how information about the distribution of carbon emissions by income affects support for carbon taxation. While carbon taxation is widely advocated as the most efficient policy for mitigating climate change, it faces significant political hurdles due to its distributional costs. Using original survey data, with an embedded experiment, we find that providing information about the actual distribution of household CO2$_2$ emissions by income significantly changes individuals' support for carbon taxation. These effects are particularly pronounced at the bottom of the household income distribution, leading to increased support for costly climate policies. However, individuals who believe that carbon taxes will reduce their income continue to hold their level of support for carbon taxation. Our findings have significant implications for understanding the public's response to the distributional consequences of the green transitions and ultimately their political feasibility. [ABSTRACT FROM AUTHOR]

This study develops a general equilibrium life-cycle model to explore the welfare and inequality implications of different ways to return carbon tax revenue back to households. We find that the welfare-maximizing rebate uses two-thirds of carbon-tax revenue to reduce the distortionary tax on capital income while using the remaining one-third to increase the progressivity of the labor income tax. This recycling approach attains higher welfare and more equality than the lump-sum rebate approach preferred by policymakers as well as the approach originally prescribed by economists—which called exclusively for reductions in distortionary taxes. [ABSTRACT FROM AUTHOR]

Green finance contributes significantly to the openness and transparency of carbon quota trading prices, which is conducive to the development of green technology innovation. With known carbon quota trading prices, we construct game‐based operational research models to analyze fixed‐fee and mixed‐fee cross‐licensing strategies for green technologies between two competing firms under the cap‐and‐trade policy. We compare the equilibrium outcomes of no‐licensing, fixed‐fee, and mixed‐fee cross‐licensing strategies. The findings reveal that product pricing under the fixed‐fee cross‐licensing strategy is beneficial to consumers. The mixed‐fee cross‐licensing strategy is optimal in terms of firms' total profits. When the degree of product substitutions is large and the improvement in carbon emissions is small, firms are more inclined to the no‐licensing strategy. We further introduce the revenue‐sharing contract, which can extend the Pareto improvement domain and improve the performance of green technology cross‐licensing strategies. [ABSTRACT FROM AUTHOR]

This paper aims to identify the most emission-intensive industries in the Czech economy using an environmentally extended input-output framework to determine whether decarbonization of the economy might jeopardize financial system stability. The main contribution of this paper to the existing literature lies in connecting bank industry-specific loan exposures with industry-specific emission intensities, which are used to calculate potential credit losses after the introduction of a carbon tax. The analysis shows that the Czech banking sector is not significantly concentrated in industries which are most vulnerable to decarbonization of the economy and threats to the financial stability of the green transition are currently low. [ABSTRACT FROM AUTHOR]

Purpose: Based on stakeholder and legitimacy theory, this paper aims to investigate the impact of carbon emission disclosure on firm financial performance. Further, the study attempts to explore the potential moderating effect of firm size on this relationship. Design/methodology/approach: The study is based on BSE 100 Indian firms for the period of 2018–2019 to 2020–2021. The association between carbon emission disclosure and firm financial performance, along with the moderating role of firm size, has been explored through regression models. Findings: The present study confirmed the significant and negative association between carbon emission disclosure and firm financial performance. Furthermore, results reveal that firm size positively moderates the relationship between carbon emission disclosure and firm financial performance. Social implications: Carbon emission disclosure helps corporate organizations advance the issues of climate change disclosure both nationally and globally. Originality/value: To the best of the authors' knowledge, the current study is the first of its kind to explore the potential moderating effect of firm size on the relationship between carbon emission disclosure and firm financial performance. The current study provides significant novel insights into sustainability, climate change and finance literature. [ABSTRACT FROM AUTHOR]

By analyzing the influence of stochastic perturbation matters on vehicle path optimization, a perturbation scheduling model for logistics and distribution with a carbon tax mechanism is established under the premise of time window variation and load capacity constraints. Herein, we propose an enhanced Genetic Algorithm (GA) based on a Gaussian matrix mutation (GMM) operator, which maintains the diversity of the population while speeding up the algorithm's convergence. The model builds a Gaussian probability matrix using the site positional order distribution characteristics implied in the original site data information, and applies the Gaussian probability matrix to individual gene mutations using a roulette-wheel-selection method; thus, the study guarantees the genetic diversity of the population while guiding it to evolve in the high-fitness direction. Finally, an experimental simulation is performed using data obtained from a commercial supermarket, thereby verifying the effectiveness of the proposed algorithm and comparing it with other algorithms. The results reveal that compared with the classical GA, the average convergence speed of the improved GA can be increased by 50–60% and the consumed algorithm time can be reduced by 48% while maintaining the difference in solution accuracy within 1%. [ABSTRACT FROM AUTHOR]

With the EU ETS 2 a new EU-wide emissions trading system is introduced that covers the greenhouse gas emission of the buildings and road transport sectors, i.e. sectors the decarbonization of which has so far been the responsibility of the Member States under the Effort Sharing Regulation. Since they will remain responsible for the achievement of their national greenhouse gas emission reduction targets under that regime, the question arises whether the Member States can maintain or introduce additional carbon pricing instruments alongside the new EU ETS 2. Hence, this paper examines the legality of such an approach, by assessing relevant provisions of EU secondary and primary law. Without going deep into the economic and political considerations, it concludes that from a legal perspective, the coexistence of national carbon pricing instruments and the EU ETS 2 is not prohibited. With the latest reform of the EU Emissions Trading System Directive (ETS Directive), the European Union (EU) has introduced a new EU emissions trading system for buildings and road transport (EU ETS 2)1. The decarbonization of those sectors traditionally falls within the responsibility of the EU Member States under the regime of the Effort Sharing Regulation (ESR). The ESR introduces legally binding national greenhouse gas (GHG) emission reduction targets. Hence, over the last few years, the Member States have introduced different measures in order to reach their targets. Those include carbon pricing instruments, understood as measures that put a price on the emission of GHG and thus create an incentive to reduce those emissions. Carbon pricing instruments include carbon taxes, as well as emissions trading systems2. With the introduction of the new ETS 2, the question arises whether the Member States can maintain (or introduce) such national carbon pricing instruments in parallel to the new EU ETS 2. [ABSTRACT FROM AUTHOR]

The conversion of renewable energy into chemical energy carriers, such as ammonia, enhances the accommodation of renewable energy for power distribution networks (PDN) and supports the decarbonization for ammonia production systems (APS). This paper addresses the integration of PDN with APS through a collaborative planning considering a carbon emission flow (CEF) model. A collaborative planning model with carbon emissions constraints is designed, and a sensitivity analysis is performed to evaluate the impact of varying renewable energy costs on the system. To further reduce carbon emissions from green ammonia production and stabilize renewable energy volatility, a nodal CEF model that incorporates energy storage systems (ESS), wind turbines (WT), and photovoltaics (PV) is proposed. The economic feasibility of the proposed model is verified via comprehensive experiments. Numerical results show that collaborative scheduling reduces both costs and carbon emissions in PDN and APS. Implementing a carbon tax encourages the transition from grey to blue ammonia production, while a decrease in renewable energy costs further promotes the shift from blue to green ammonia. Besides this, the analysis indicates that integrating long-term operation of WT and PV, together with low-cost renewable electricity and ESS, boosts the economic efficiency of the green ammonia production system. • An integration of PDN with APS through a collaborative planning considering CEF model is proposed. • Employing the CEF model to calculate carbon emissions from grey, blue, and green ammonia production. • Carbon tax is used as a tool to encourage the low carbon transition of ammonia production. • A CEF model that incorporates ESS, WT, and PV is designed and the economic feasibility of the proposed model is verified. [ABSTRACT FROM AUTHOR]

This study introduces a novel application of a temporal convolutional network (TCN) for projecting carbon tax prices, addressing the critical need for accurate forecasting in climate policy. Utilizing data from the World Carbon Pricing Database, we demonstrate that the TCN significantly outperformed traditional time series models in capturing the complex dynamics of carbon pricing. Our model achieved a 31.4% improvement in mean absolute error over ARIMA baselines, with an MAE of 2.43 compared to 3.54 for ARIMA. The TCN model also showed superior performance across different time horizons, demonstrating a 30.0% lower MAE for 1-year projections, and enhanced adaptability to policy changes, with only a 39.8% increase in prediction error after major shifts, compared to ARIMA's 95.6%. These results underscore the potential of deep learning for enhancing the precision of carbon price projections, thereby supporting more informed and effective climate policy decisions. Our findings have significant implications for policymakers and stakeholders in the realm of carbon pricing and climate change mitigation strategies, offering a powerful tool for navigating the complex landscape of environmental economics. [ABSTRACT FROM AUTHOR]

The article "Climate-Related Financial Stability Risks for the United States: Methods and Applications" examines various models used to study climate-related financial stability risks (CRFSRs) in the U.S. It discusses the strengths and weaknesses of ten types of models and their suitability for assessing CRFSRs, noting a high level of uncertainty in current assessments. The text also delves into the methodology of natural capital analysis, emphasizing the importance of measuring firms' exposure to natural resource degradation and the impacts on business models. It concludes by suggesting ways to combine existing methodologies for a more comprehensive understanding of climate risks and vulnerabilities, highlighting the need for further research in integrating climate-related risks into modeling frameworks. [Extracted from the article]

Many countries are implementing carbon taxation to limit emissions, and this provides a new form of tax revenue. Studies have taken up the question of what forms of expenditure from carbon taxation receive public support and whether 'revenue recycling' can improve support for carbon taxation. However, public attitudes are ambiguous. We argue that some of the diverse findings partly reflect that previous studies have lacked the trade‐offs that come with expenditures and that we need to expand focus beyond what the average citizen wants. Therefore, we use an approach where members of the Danish public are asked how they would like to divide the total sum of carbon tax revenues between eight specific areas. We employ hierarchical cluster analysis, which shows a diverse field of groups. This reveals that, while generally popular, expenditures toward climate mitigation and adaptation need to be complemented by social spending to achieve broader support. Related Articles: Ike, Vivian. 2020. "The Impact of Veto Players on Incremental and Drastic Policy Making: Australia's Carbon Tax Policy and Its Repeal." Politics & Policy 48(2): 232–64. https://doi.org/10.1111/polp.12346. Lachapelle, Erick, Thomas Bergeron, Richard Nadeau, Jean‐François Daoust, Ruth Dassonneville, and Éric Bélanger. 2021. "Citizens' Willingness to Support New Taxes for COVID‐19 Measures and the Role of Trust." Politics & Policy 49(3): 534–65. https://doi.org/10.1111/polp.12404. Tuxhorn, Kim‐Lee, John D'Attoma, and Sven Steinmo. 2021. "Do Citizens Want Something for Nothing? Mass Attitudes and the Federal Budget." Politics & Policy 49(3): 566–93. https://doi.org/10.1111/polp.12406. [ABSTRACT FROM AUTHOR]

We develop a dynamic, stochastic general equilibrium (DSGE) model for the euro area that accounts for climate change-related risk considerations. The model features polluting ("brown") firms and non-polluting ("green") firms and a climate module with endogenous emissions modeled as a byproduct externality. In the model, exogenous shocks propagate throughout the economy and affect macroeconomic variables through the impact of interest rate spreads. We assess the business cycle and policy implications of transition risk stemming from changes in the carbon tax, and the implications of the micro- and macroprudential tools that account for climate considerations. Our results suggest that a higher carbon tax on brown firms dampens economic activity and volatility, shifting lending from the brown to the green sector and reducing emissions. However, it entails welfare costs. From a policy-making perspective, we find that when the financial regulator integrates climate objectives into its policy toolkit, it can minimize the trade-off between macroeconomic volatility and welfare by fully coordinating its micro- and macroprudential policy tools. [ABSTRACT FROM AUTHOR]

In light of the volatility of market demand and carbon trading prices, this study examines the effects of two carbon policies—the carbon tax policy and the cap‐and‐trade policy—as well as various information structures on the supply chain's carbon emission reduction incentives. A brand incentivizes the carbon abatement effort of an upstream supplier through a two‐part contract in the form of a fixed salary and a proportional incentive. We discover that, under some circumstances, the brand may benefit more from the unobservability of supply chain information. The brand bundles the risk of uncertainty with the supplier through the proportional incentive. In classical incentive contracts, only the cost is considered and the positive effect of risk conveyance is often ignored. In our study, the brand needs to investigate a trade‐off between the benefit of risk conveyance and the drawback of the incentive cost. On one hand, the proportional incentive characterizes the incentive cost. The brand increases the incentive intensity due to the unobservable effort of the supplier. On the other hand, it also has a risk conveyance effect. Specifically, the proportional incentive decreases with the correlation coefficient under the cap‐and‐trade policy. Additionally, there are situations in which consumer surplus benefits from the observability of supply chain information. However, supply chain information transparency is harmful to consumer surplus as supplier risk aversion increases. [ABSTRACT FROM AUTHOR]

In the practical evolution of shared vehicle systems, numerous societal factors come into play, such as inadequate parking infrastructure, battery capacity, and the budget for technological improvement. This study integrates the operational realities of shared vehicle systems with governmental carbon emission reduction policies and "double control" initiatives. Considering various perturbations, the paper constructs a Stackelberg short‐term model among diverse oligopolistic shared vehicle operators with technique sharing. It also develops a long‐term repeated game framework to scrutinize the impact of pertinent parameters on operators' decision variables and profits, along with system stability and complexity. The findings, elucidated through numerical analyses, reveal that the burgeoning sensitivity of users to energy conservation augments the overall shared vehicle market. The technique sharing mechanism boosts the benefit of the whole group of shared vehicle operators while diminishing the start‐up operators' revenue. In the long term, however, excessive price adjustments by SEV operators may lead to market chaos and profit erosion. Conversely, enhancing the adjustment coefficient of technological level levels by start‐up SEV2 operators may result solely in their own decision‐making becoming unmanageable. Finally, we found that both the methods of external force feedback control and parameter control are effective in restoring the chaotic market to stability. [ABSTRACT FROM AUTHOR]

Recent trends in portfolio management emphasize the importance of reducing carbon footprints and aligning investments with sustainable practices. This paper introduces Sensitivity Value-at-Risk (SensitivityVaR), an advanced distortion risk measure that combines Value-at-Risk (VaR) and Expected Shortfall (ES) with the Cornish–Fisher expansion. SensitivityVaR provides a more robust framework for managing risk, particularly under extreme market conditions. By incorporating first- and second-order distorted stochastic dominance criteria, we enhance portfolio decarbonization strategies, aligning financial objectives with environmental targets such as the Paris Agreement's goal of a 7% annual reduction in carbon intensity from 2019 to 2050. Our empirical analysis evaluates the impact of integrating carbon intensity data—including Scope 1, Scope 2, and Scope 3 emissions—on portfolio optimization, focusing on key sectors like technology, energy, and consumer goods. The results demonstrate the effectiveness of SensitivityVaR in managing both risk and environmental impact. The methodology led to significant reductions in carbon intensity across different portfolio configurations, while preserving competitive risk-adjusted returns. By optimizing tail risks and limiting exposure to carbon-intensive assets, this approach produced more balanced and efficient portfolios that aligned with both financial and sustainability goals. These findings offer valuable insights for institutional investors and asset managers aiming to integrate climate considerations into their investment strategies without compromising financial performance. [ABSTRACT FROM AUTHOR]

This study examines the effects of carbon tax policies on carbon emissions in the context of green technology spillovers among manufacturers. We develop a differential game model that incorporates both horizontal and vertical green technology spillovers, analyzing scenarios with and without a carbon tax policy. Our equilibrium analysis demonstrates that a carbon tax policy effectively promotes carbon reduction in manufacturers experiencing green technology spillovers by increasing investment in green technology. The policy also mitigates the negative effect of free-riding among competing manufacturers (horizontal spillovers) while enhancing the positive effect of free-riding among non-competitors (vertical spillovers). Additionally, we find that raising carbon tax or fostering vertical spillovers can enhance the profitability of supply chain participants by expanding the market scale. Conversely, elevating consumer environment awareness yields greater benefits for those who innovate (the spiller) rather than those who adopt (the recipient). Our findings offer novel managerial insights for manufacturers navigating green technology spillovers in a landscape shaped by carbon tax policy. [ABSTRACT FROM AUTHOR]

Supply chain carbon abatement is an important way to promote low-carbon transformation of the social economy and address global climate change. This paper analyzes the issue of supply chain carbon abatement under different power structures, as well as the effect of consumers' low-carbon preference and carbon tax rate on the optimal decisions. This paper constructs five different models, namely ML-NO model, ML-CS model, RL-NO model, RL-CS model and VI model. The research finds that VI model is the most ideal model for promoting supply chain carbon abatement. The optimal abatement efforts, market demand, and total profits in the VI model are all the largest among the five models. Whether the supply chain leader is the manufacturer or the retailer, cost sharing contract can enhance optimal abatement efforts, market demand, and profits of both parties. In any model, the leader in Supply chain earns higher profits than the follower. When consumers' low-carbon preference increases, the optimal abatement efforts, market demand, and profits of both parties will all increase, and the growth rate is gradually accelerating. For the manufacturer with high carbon emissions, when the carbon tax rate increases, the optimal abatement efforts first increase and then decrease. For the manufacturer with low carbon emissions, when the carbon tax rate increases, the optimal abatement efforts will also increase. [ABSTRACT FROM AUTHOR]

Global warming's major cause is the emission of greenhouse-effect gases (GHG), especially carbon dioxide (CO 2) whose main source is the combustion of fossil fuels. Fossil fuels serve as the primary energy source in many industries, including shipping, which is the focus of this study. One of the measures proposed to tackle GHG emissions is the development of green shipping corridors - carbon-free shipping routes that require the transition to alternative fuels, which are gaining competitiveness. One of the reasons for that is carbon pricing, which taxes CO 2 emissions. However, the lack of consensus on the most cost-advantageous alternative fuel in the long run results in the delay of the implementation of green shipping corridors. To make it more accessible for stakeholders to conduct an economic analysis of the various options, a framework to determine and minimize the costs of transitioning from fossil fuels to any alternative fuel is proposed, over the period of one voyage, considering the lost opportunity cost, the deployment cost of bunkering vessels at the necessary call ports, the cost of converting the vessel, the car-bon emissions tax cost, and the fuel cost. This will allow stakeholders to choose the most economical alternative fuel, accelerating the development of green shipping corridor initiatives. To validate the effectiveness of the framework, it was applied in a case study involving a shipowner seeking to transition from heavy fuel oil (HFO) to Ammonia, Hydrogen, Liquefied Natural Gas (LNG), or Methanol. This study faced limitations due to the unknown costs of installing bunkering vessels for Ammonia and Hydrogen. However, it evaluates the cost-effectiveness of alternative fuels, providing insights into their short-term economic viability. The results showed that Hydrogen is the most cost-advantageous fuel until a deployment cost per bunkering vessel of 1,990,285$ for a sailing speed of 22 knots and 2,190,171$ for a sailing speed of 18 knots is reached, after which LNG becomes the most economical option regardless of variations in the carbon tax. Moreover, a sensitivity analysis was conducted to determine the effects of variations in parameters, such as carbon tax, fuel prices and vessel conversion costs in the total cost of each fuel option. Results highlighted that even though HFO remains the most economical fuel option, even when considering a high increase in carbon tax, the cost gap between HFO and alternative fuels narrows significantly with the increase in carbon tax. Furthermore, the sailing speed impacts the fuels' competitiveness, as the cost difference between HFO and alternative fuels decreases at higher speeds. • A tool has been developed to guide the transition from fossil fuels, towards green shipping corridors. • An analysis was conducted to determine if increasing carbon taxes would make alternative fuels more financially viable than HFO. • The study identifies hydrogen as cost-advantageous, followed by LNG, influenced by varying carbon taxes. • Results demonstrated that HFO is still the most economical fuel option, even considering a very high carbon tax. • Challenges lie in uncertain bunkering vessel costs, potential profit, and the need for a model extension for fleet use. [ABSTRACT FROM AUTHOR]

A basic principle of virtually every regulation to improve grid reliability and reduce power sector emissions is that market participants change their behavior when regulations make it more expensive to engage in socially harmful activities. To give a concrete example, a carbon tax assumes that increasing the costs of emitting carbon dioxide will lead market participants to reduce energy consumption and switch to less carbon-intensive resources. But this assumption does not apply to large parts of the electricity industry, where investor-owned utilities are often able to pass the costs of climate and reliability rules on to captive ratepayers. The underlying problem, I argue, is that the U.S. legal system outsources investment and market design decisions to private firms that will be financially harmed if state and federal regulators pursue deep decarbonization or take ambitious steps to improve grid reliability. At the state level, this occurs because utilities propose new infrastructure in integrated resource plans that authorize cost recovery from captive customers. At the federal level, this occurs because the Federal Power Act gives incumbent utilities "filing rights" that authorize them to submit, or "file," regulations and rates related to their assets. Utilities use their filing rights both to propose favorable market rules and to design governance structures that allow them to control the multimember organizations that plan grid infrastructure and ensure resource adequacy. Given that regulatory environment, it is little surprise that incumbent utilities design electricity market rules that counteract climate and reliability regulations. These observations underscore that structural changes such as full corporate unbundling, market liberalization, and aggressive governance reforms are needed to make climate and reliability policies more effective and easier to administer. [ABSTRACT FROM AUTHOR]

Climate risk assessment is critical for organisations, especially in sectors such as the processed food sector in Colombia. This study addresses the identification and assessment of the main climate transition risks using an approach that combines fuzzy logic with several multi-criteria decision-making methods. This approach makes it possible to handle the inherent imprecision of these risks and to use linguistic expressions to better describe them. The results indicate that the most critical risks are price volatility and availability of raw materials, the shift towards less carbon-intensive production models, increased carbon taxes, technological advances, and associated development or implementation costs. These risks are the most significant for the organisation studied and underline the need for investments to meet regulatory requirements, which are the main financial drivers for organisations. This analysis highlights the importance of a robust framework to anticipate and mitigate the impacts of the climate transition. [ABSTRACT FROM AUTHOR]

We investigated whether carbon taxes with and without carbon dividends improve cooperative behavior to mitigate simulated climate change. We implemented a randomized controlled trial on a large sample of the U.S. general population (N = 2 , 116). Played in real-time in groups of four, we tested three carbon-pricing treatments and a baseline condition within a modified threshold public goods game of loss avoidance. We found that a carbon tax coupled with carbon dividends reduces carbon-emitting group consumption relative to a baseline condition with no tax, and relative to a carbon tax only. A carbon tax coupled with carbon dividends paid out to below-average polluters (asymmetric dividend) worked best, with 94% of groups remaining below a critical consumption (emission) threshold. We also found that experiencing the asymmetric dividend condition positively affected perceptions of carbon pricing with carbon dividends. [ABSTRACT FROM AUTHOR]

Climate change engendered by carbon emissions has become a major threat to human life and the world economy. Many of early studies corroborate that carbon tax and subsidy are effective policy tools to alleviate climate change. Most of them, however, use closed-economy models with a single firm to analyze the effects of these two policies. This paper explores the effects of carbon tax, subsidy and foreign carbon emissions on economic activities in an open macroeconomic model that features low- and high-carbon firms. The main findings suggest that carbon tax, subsidy and foreign carbon emissions all deliver heterogeneous outcomes by largely affecting high-carbon firms. The shortage of national income due to weak economic activities leads the economy to issue more international bonds. The takeaway from all the analyses is that government should introduce various carbon taxes that are geared towards target firms with different carbon emissions and adopt optimal means to manage national debt. [ABSTRACT FROM AUTHOR]

Under the heading of sustainability challenges, this study incorporates payment procedures and inventory selections. The article's goal is to acquire insight into how the methods of payment affect perishable product inventory selections under the widely utilised carbon tax regime in view of policies to reduce emissions. Uncertainty arises as a natural consequence of the unpredictable behaviour of customers. Keeping these impacts in mind, an interval-valued inventory model is introduced, where all the related inventory parameters are considered interval-valued. In addition, the vendor offers an interval-valued discount rate to customers against advance payment. Due to the inventory parameters being chosen as interval-valued, the objective function is changed into an interval-valued form, and the corresponding differential equation is changed into an interval differential equation. To solve the interval-valued differential equation, a parametric approach to interval is introduced, and the corresponding interval-valued objective function is constructed. Interval order relations and the MATHEMATICA software are used to solve the objective function with interval values. To assess the validity of the proposed model, one numerical example is solved, and a sensitivity analysis of the ideal course of action is performed. [ABSTRACT FROM AUTHOR]

Carbon emissions are a major contributor to global warming and climate change. The government has adopted carbon tax (CT) and cap-and-trade policies to reduce carbon emissions from carbon companies. This paper develops a production–inventory model for scarce perishable goods under different carbon policies and outside green technology. This study covers the contribution of energy-efficient green technology in a multi-stage supply chain to control carbon emissions in producing and transporting goods from the manufacturer to the dealer. However, it discusses a different combination of carbon policies chosen for manufacturers and retailers in their countries. According to the findings, changes in carbon pricing, CT, and exchange rates under various policy combinations have varying effects on the entire supply chain, each member's interests, and the social benefits of reducing carbon emissions. It seeks to provide useful information to decision-makers in businesses or supply chains, especially multinational corporations, to make decisions related to fixed rate CT and cap partial deficit cases, long cycle time, reasonable profit with small value, and long term and low cost of green technology investment. The main objective is to find the best material sourcing, production, and distribution strategy for manufacturers and the best replenishment strategy for retailers to maximize the overall joint profitability of the supply chain. In summary, sensitivity analysis has provided an optimal solution management implication based on certain key parameters and CT size. [ABSTRACT FROM AUTHOR]

Environmental policies such as carbon tax implementation significantly impact the technology choice and cost structure of the upstream manufacturer, affecting the downstream retailer's the procurement decision and risk management in a sustainable supply chain. This study constructs a single-manufacturer-single-retailer supply chain model constrained by carbon tax policies to analyze the influence of retailer's anticipated regret on the supply chain operation and environmental performance. Utilizing game theory, the research finds that the retailer's anticipated regret behavior suppresses manufacturer's willingness to invest in the green initiative, resulting in a non-monotonic effect on profits. When the retailer's regret level is low and her demand for eco-friendly products is also low, the manufacturer tends to reduce the green investment and increase the wholesale price to maximize the marginal return. Although such the anticipated regret behavior by the retailer may stimulate the manufacturer's profit growth, it reduces retailer's profit. Conversely, as the retailer's regret level increases, the manufacturer increases the green investment and reduces the wholesale price to induce higher procurement by the retailer, leading to a decline in the manufacturer's profit but an upward trend in the retailer's profit. This discovery suggests that the upstream supply chain manager, should closely the monitor retailer's potential anticipated regret and adjust the corresponding strategy accordingly. Furthermore, the study finds that the lower level of retailer's anticipated regret positively impact environmental behavior, offering the policymaker a new perspective on promoting the green supply chain practice. [ABSTRACT FROM AUTHOR]

The nature of complementary products is the dependency of one product on the other for utility. Further, the complementary products with deteriorated nature create a challenging environment for a suitable strategy. How does an industry deal with complementary deteriorated products at the retailer's house? The present study deals with two complementary deteriorating products in a two-echelon supply chain management. The deterioration of complementary products increases with time, and the deterioration rate is taken as the function of time. Complementary deteriorating products are manufactured by two manufacturers and sold to a common retailer. Manufacturers use a flexible production system to produce products and a single-setup-multiple-delivery policy to deliver those products. Under the flexible production system, emissions from setup, holding products, disposal, and transportation of products are considered. A carbon tax policy is used to reduce emissions. This study aims to optimize the total profit of the supply chain by finding a suitable sales strategy. The total profit is maximized by acquiring the optimal values of the retail price, cycle time of the retailer, production rate, and number of shipments. The numerical result shows that the profit becomes maximum when complementary products are less dependent on each other. The result indicates that adapting the flexible production system increases the total profit by 1.86% and decreases total emissions by 5.36% than a traditional production system. [ABSTRACT FROM AUTHOR]

This paper examines investment responses to emission taxes and the role of tax incidence in passing on tax burdens. Using private firms from Spain and the introduction of an emission tax in 2013 in the Autonomous Community Valenciana, we show that investments decline in response to the emission tax. Importantly, this investment decline does not depend on the level of pollution but on economic factors related to tax incidence. Investments in firms operating in highly competitive markets, firms with low pricing power, and firms with low financial flexibility are the most affected by environmental taxes. We generalize the investment findings using the introduction of carbon taxes in France and Ireland in a stacked difference-in-differences design. Overall, our results indicate that emission taxes affect not only polluters but also other firms and stakeholders such as suppliers, customers, and consumers depending on the relative elasticities of supply and demand. [ABSTRACT FROM AUTHOR]

Background: Pressure is growing in North America for heavy-duty, long-haul trucking to reduce greenhouse gas (GHG) emissions, ultimately to zero. With freight volumes rising, improvement depends on zero-emissions technologies, e.g., battery electric vehicles (BEVs) and fuel cell electric vehicles (FCEVs). However, emissions reductions are constrained by technological and commercial realities. BEVs and FCEVs are expensive. Further, BEVs depend on existing electricity grids and FCEVs rely on steam–methane reforming (SMR) or electrolysis using existing grids to produce hydrogen. Methods: This study assembles publicly available data from reputable sources to estimate breakeven vehicle purchase prices under various conditions to match conventional (diesel) truck prices. It also estimates GHG emissions reductions. Results: BEVs face numerous obstacles, including (1) limited range; (2) heavy batteries and reduced cargo capacity; (3) long recharging time; and (4) uncertain hours-of-service (HOS) implications. On the other hand, FCEVs face two primary obstacles: (1) cost and availability of hydrogen and (2) cost of fuel cells. Conclusions: In estimating emissions reductions and economic feasibility of BEVs and FCEVs versus diesel trucks, the primary contributions of this study involve its consideration of vehicle prices, carbon taxes, and electricity grid capacity constraints and demand fees. As electricity grids reduce their emissions intensity, grid congestion and capacity constraints, opportunities arise for BEVs. On the other hand, rising electricity demand fees benefit FCEVs, with SMR-produced hydrogen a logical starting point. Further, carbon taxation appears to be less important than other factors in the transition to zero-emission trucking. [ABSTRACT FROM AUTHOR]

Copyright of Journal of Management & Economics Research is the property of Journal of Management & Economics Research and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The article "Green ECB Credit: One Step Too Far" by Christian Pfister discusses the proposal to refinance green credit by the European Central Bank at favorable conditions. The motives, implementation, and potential criticisms of the proposal are examined, with a conclusion that adopting the measure would be excessive. Various economists and policymakers have supported this proposal, including the head of state in France, but the article raises concerns about the implications of such a measure. The author presents a critical analysis of the proposal, highlighting potential economic, legal, and administrative challenges that may arise from its implementation. [Extracted from the article]

In 'Embracing the Brave New World: A Response to Demekas and Grippa', a response to our article 'Walking a Tightrope: Financial Regulation, Climate Change, and the Transition to a Low-Carbon Economy', both published in the Journal of Financial Regulation, Gruenewald, Knijp, Schoenmaker, and van Tilburg claim that climate risk is a clear and present danger to financial stability that justifies imposing higher capital requirements on supervised firms. Until the current prudential risk framework is revised to fully capture climate risk, they advocate ad hoc measures, such as adjustments to risk weights, which, they believe, would have the desired effect. In this article, we argue that these claims are misguided. Given the nature of climate risk, risk assessment models cannot provide a reliable basis for calibrating capital requirements. On the basis of the evidence, prudential tools would have only a negligible impact on the transition. And the idea of adjusting risk weights for climate exposures has been abandoned—for good reasons. Ultimately, there is nothing financial regulation can do about the energy transition that an appropriately designed carbon tax cannot do better. Central banks and financial regulators should resist the pressure to take on additional responsibilities that are essentially political and that they cannot properly discharge. [ABSTRACT FROM AUTHOR]

Copyright of Journal of Guangdong University of Technology is the property of Journal of Guangdong University of Technology and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This paper sheds light on the unidentified effects of unilateral environmental and trade actions within an international trade framework with two large open economies, transboundary pollution, and Public Pollution Abatement (PPA) activities. When private and public abatement coexists in the exporting country, stricter environmental policy by the importing one magnifies the carbon leakage effect. Pareto efficiency dictates that Border Carbon Adjustment (BCA) should account not only for the difference in carbon taxes between the two countries, but also for the policy's unintended consequences on PPA. More importantly, we argue that a conditional reduction of BCA, subject to stricter environmental policy by the country that exports the polluting good, decreases global pollution and increases countries' welfare. Such reform strategy generates strong incentives for countries with laxer environmental policy to adopt a stricter one. [ABSTRACT FROM AUTHOR]

Decarbonization and carbon tax have become increasingly relevant in recent years, due to the economic implications in industry, and especially in the energy sector. Naturally, the implementation of decarbonization policies in Western Balkans countries is a necessity for mitigating the environmental crisis in the region. This study examines the impact of carbon tax on economic growth in Western Balkan countries including Croatia. Our research is a quantitative empirical study based on regression model. Panel data on empirical study is based on 91 years of observation of Western Balkan countries, each of these countries has a 13-year observation. Data includes two sets of variables and examines the panel data obtained from World Bank Open Data over the period 2010-2022. The results indicate a significant impact of CO2 emission tax on economic growth in Western Balkan countries. The result shows that CO2 emission tax and economic growth are negatively correlated with each other. The results indicate a significant impact of CO2 emission tax on economic growth in Western Balkan countries. A percentage CO2 emission tax, causes a 2.52 decrease in economic growth under ceteris paribus average. CO2 emission tax, FDI, GDP growth and unemployment rate indicate an inelastic relationship. The highest negative impact is shown in the state of Kosova, followed by Serbia and Bosnia and Herzegovina. The high negative impact on these countries is due to their high reliance on coal in energy production. [ABSTRACT FROM AUTHOR]

Employing a unique approach to household utility maximization, this paper explores the implications of vehicle carbon taxation and subsidies in the context of household choice for urban transportation mode where there exist two private characteristics of travel: comfort and time efficiency, and a third public negative characteristic, carbon emissions. Two policies to reduce carbon emissions are examined in this framework; (1) subsidizing public transportation and imposing a tax on vehicle emissions, (2) increasing the cost of private vehicle travel, and providing a rebate of the tax collected to the consumer. The results suggest that the latter policy may have little impact on carbon emissions and could possibly lead to an increase in emissions. [ABSTRACT FROM AUTHOR]

This study is a comparative analysis of Kenya and South Africa, the largest economies in Eastern and Southern Africa respectively, based on gross domestic product (GDP), energy use and carbon emissions. This study investigates the contribution of economic growth and renewable energy use on greenhouse carbon dioxide emissions in both country-level and group data, to observe their possible impact on environmental pollution. The present study addresses United Nations Sustainable Development Goal 13, to combat climate change and its impacts. To this end, this study is conducted in Kenya and South Africa using secondary data for the period 1990-2022. As an econometric strategy, we adopt the use of both panel and time series over the highlighted countries. The study employed an ARDL and PMG panel estimation approach to analyze the long-run relationship while Granger causality was conducted to confirm the short-run relationship between study variables. The empirical results show that economic growth and energy use significantly increase carbon emissions in South Africa, Kenya and aggregate data. Moreover, changes in industrial structure and urbanization have a mixed influence on carbon emissions in all models. Furthermore, short-run causality results point to a unidirectional relationship running from economic growth to carbon emissions in Kenya. In contrast, for South Africa, causality runs from carbon emissions to growth. In addition, for panel analysis, the study confirmed a bidirectional relationship. In conclusion, this comparative case study shows that countries with substantial growth in GDP and intensive energy use have high carbon emissions. Given these, the positive relationship poses a dilemma for Kenya and South Africa in their drive to achieve growth and at the same time manage environmental pollution. The empirical findings of this study imply that these countries should take all possible policy actions such as the massive investment and deployment of renewable energy, shifting gradually from non-renewable energy sources to renewable sources, a range of renewable energy sources, especially those that don't generate greenhouse gases, are needed, the use of climate finance to transition to clean energy, carbon tax policy and trading schemes to curtail growth in carbon emissions and environmental degradation. [ABSTRACT FROM AUTHOR]