Analysis of the Single-Period Problem under Carbon Emissions Policies

This paper is aimed at the call of the United Nations Intergovernmental Panel on Climate Change (IPCC) for the need to maintain global warming within a controllable range. The goal is to target carbon emissions to achieve “net-zero” emissions, along with constructing a green energy investment strategy model for firms in response to government’s environmental protection policies. The paper uses the real options approach of dynamic investment decision to construct an investment decision model. Considerations include government taxation of carbon emissions, subsidies to reduce carbon emission policies, and incentives for firms to renew their investments in green energy equipment. Assuming that there is uncertainty in government carbon emission taxes and a reduction of carbon emission subsidies, the changes follow the joint geometric Brownian movement. We used this model to solve the optimum of the threshold for carbon emission taxes and of carbon emission reduction subsidies ratio. If carbon emission taxes and carbon emission reduction subsidies ratio are higher than the threshold, a firm suspends investment in green energy equipment because government subsidies are insufficient. If carbon emission taxes and the carbon emission reduction-subsidy ratio are less than or equal to the threshold, then a firm is qualified for the government’s subsidies for reducing carbon emissions, and the firm invests in green energy equipment. The results of this study can provide reference for firms to invest in green energy equipment, and for government control of carbon emission policies. This policy can effectively reduce carbon emissions and achieve co-construction, co-governance, and the sharing of innovative social governance patterns. Finally, it can create a win–win situation between the government, firms, and society.

This paper studies the incentive for a firm’s sustainable pricing and production policies with carbon dioxide emissions tax policy. We consider two competing firms who have different operation efficiencies and produce a same product to the end-users. Based on game theory models, we derive the competing firms’ optimal pricing and production policies, and show that the high-efficiency firm will set a lower retail price than that of the low-efficiency firm, either with same carbon emissions tax or without carbon emissions tax. When the two competing firms absorbed same carbon emissions tax, we show that both of them will set higher retail price than that without carbon emissions tax, and the high-efficiency firm’s both profit reduction and carbon emissions reduction percentages are lesser than that of low-efficiency firm. In addition, we find that when a firm incurs a higher carbon emissions tax, the firm gains a higher carbon emissions reduction percentage, but the competing firm gains a lower carbon emissions reduction percentage. We also find that in order to achieve a certain desired carbon emissions reduction percentage, the carbon emissions tax imposed on the high-efficiency firm should be more than that on the low-efficiency firm.

We investigate the duopoly producing strategy under carbon emissions including the carbon emissions tax, mandatory carbon emissions capacity and cap-and-trade. We use the game theory to analyze the duopoly manufactories production quantity strategies. Result shows, under each policy, we can find the Nash Equilibrium of two firms' optimal production quantity and expected profit. Specifically, we derive that duopoly market's profit is optimal when implementing the cap-and-trade policy.

As carbon emissions are one of the major problems of an emission-generating firm (EGF), there is a dire need to reduce them, and so this study fills this gap in the literature by considering the optimal behavior of environmental policies. This research develops policy measures under a duopoly game model such as carbon emission tax (CET) and subsidy on green investment (SGI). Additionally, we formulate a simulation model to measure the optimal behavior of CET, SGI, and production quantity to maximize profit and carbon emission reduction. The findings indicate that when green investment decreases, the EGFs are better able to pay CET and the government is also capable of providing SGI. Moreover, a lower unit production cost reduces more carbon emissions versus a higher unit production cost. In this way, the government receives revenue due to CET implementation and an EGF obtains revenue due to SGI. Both parties gain benefits at the same time and play important roles in cutting carbon emissions to make the environment clean. This study helps governments in finding their own optimal CET and SGI. An optimal SGI assists decision-makers at reducing carbon emissions and targeting profit maximization.

How to effectively solve traffic congestion and transportation pollution in urban development is a main research emphasis for transportation management agencies. A carbon emissions tax can affect travelers’ generalized costs and will lead to changes in passenger demand, mode choice and traffic flow equilibrium in road networks, which are of significance in green travel and low-carbon transportation management. This paper first established a mesoscopic model to calculate the carbon emissions tax and determined the value of this charge in China, which was based on road traffic flow, vehicle speed, and carbon emissions. Referring to existing research results to calibrate the value of time, this paper modified the traveler’s generalized cost function, including the carbon emissions tax, fuel surcharge and travel time cost, which can be used in the travel impedance model with the consideration of the carbon emissions tax. Then, a method for analyzing urban road network traffic flow distribution was put forward, and a joint traffic distribution model was established, which considered the relationship between private cars and taxis. Finally, this paper took the city of Panjin as an example to analyze the road traffic carbon emissions tax’s impact. The results illustrated that the carbon emissions tax has a positive effect on road network flow equilibrium and carbon emission reduction. This paper will have good reference value and practical significance for the calculation and implementation of urban traffic carbon emissions taxes in China.

Purpose — This study aims to examine the effect of climate change risk disclosure on stock market performance in Nigeria from 2006 to 2022 Design/methodology/approach — The study adopted an ex post facto research design and the Vector Error Correction Model (VECM) to estimate the regression coefficients. As the dependent variable, the stock market performance was proxied by the all-share index. In contrast, the climate change policy was proxied by carbon emission taxes (CET) and solid mineral mining taxes (SMT). Other determinant of stock market performance such as the federal government green bond (FGBond) was added to the model to mirror the macroeconomic and financial environment. Findings — From the analysis results, the model test of stationarity showed that all the variables were not stationary at the level but at first difference 1(1). The descriptive and normality tests indicated that the data were normal and fit for the intended analysis. The study found evidence of a long-run relationship among the model variables based on the Johansen test for cointegration. The vector error correction indicated a fast speed of adjustment from the short run to the long run at about 32.04% annually, from the system equation regression. However, the significant findings of the study are: carbon emission taxes had significant positive impact on the stock market performance in Nigeria, (coefficient: LOGCET = 1.085279, p-value 0.0221); solid mineral mining tax has significant positive impact on the stock market performance in Nigeria, (coefficient: LOGSMMT = 0.619464, p-value = 0.0009); and Federal government green bond has significant positive impact on the stock market performance in Nigeria. (Coefficient: LOGFGBond = 0.934925, p-value of 0.0000). Implications—This study's policy implications are that risk mitigation efforts such as carbon emission and solid mineral taxes, as well as green bonds targeting climate change, will remain a practical component of stock market performance policies. Originality/value—Many researchers and policy-makers believe that access to climate change risk mitigation in developing countries improves stock market returns while reducing market vulnerability and contributing to overall economic growth. This approach has expanded rapidly and widely over the past several decades and is currently used in several growing African states. Paper type — Empirical Research

Today, high-tech industries such as consumer electronics commonly face government rules on carbon emissions. Among the rules, carbon emission tax as well as extended producer responsibility (EPR) tax are two important measures. Using blockchain, the policy makers can better determine the carbon target environmental taxation (CTET) policy with accurate information. In this paper, based on the mean-variance framework, we study the values of blockchain for risk-averse high-tech manufacturers who are under the government’s CTET policy. To be specific, the government first determines the optimal CTET policy. The high-tech manufacturer then reacts and determines its optimal production quantity. We analytically prove that the CTET policy simply relies on the setting of the optimal EPR tax. Then, in the absence of blockchain, we consider the case in which the government does not know the manufacturer’s degree of risk aversion for sure and then derive the expected value of using blockchain for the high-tech manufacturers. We study when it is wise for the high-tech manufacturer and the government to implement blockchain. To check for robustness, we consider in two extended models respectively the situations in which blockchain incurs non-trivial costs as well as having an alternative risk measure. We analytically show that most of the qualitative findings remain valid.

Inventory management in supply chains with consideration of Logistics, green investment and different carbon emissions policies

Exploring the effect of cap-and-trade mechanism on firm's production planning and emission reduction strategy

Joint berth allocation and quay crane assignment under different carbon taxation policies

The design of China’s industrial carbon reduction policies is still in its early stages, so currently, comparing the effectiveness of various emission reduction policies can help China design emission reduction policies. This paper develops a dynamic stochastic general equilibrium (DSGE) model of China’s manufacturing industry and investigates the impact of innovation on environmental protection technology, the carbon emissions tax, and government emissions reduction expenditures on the output and carbon emissions reduction of China’s manufacturing industry. Unlike previous studies that examined one policy using a single model, by focusing on the differences between three shocks it is possible to make the policies more comparable, and the comparison is more convincing. The results indicate that updating environmental protection technology can promote the development of the manufacturing industry and reduce carbon emissions in the short term. Carbon emissions taxes have a negative effect on manufacturing output in the short term and a significant and lasting effect on the reduction of carbon emissions in the long term. The government’s emissions reduction expenditures have a positive effect on manufacturing output in the short term, but a non-significant negative effect in the long term. The Chinese government should take the lead in implementing carbon emissions tax policies in heavily polluting industries and regions while lowering but stabilizing emissions reduction expenditures.

Carbon dioxide is believed widely to be the major contributor to global warming. Policymakers worldwide are turning to tax policies in an effort to abate carbon emissions. China is the largest emitter of carbon emissions on our planet. The central government, as well as the local official, has introduced a series of environmental regulations, such as environmental protection tax and emissions trading system, to reduce carbon emissions and improve environmental quality. In the near future, the carbon emission tax is also expected to be implemented by the Chinese government. In order to analyze and predict the effect of the carbon emission tax on environmental and economic systems, we developed a four department dynamic stochastic general equilibrium model, which includes households, enterprises, the government, and the environment. The dynamic parameters were obtained using maximum likelihood estimation. In the comparative static-s analysis, we found that after the introduction of carbon emission tax, the level in environmental quality was substantially improved, whereas most economic variables were significantly reduced. Moreover, we used impulse responses functions to evaluate how one shock to the carbon emission tax affects the steady static values for these endogenous variables in our model. We found that the carbon emission tax shock has an instantaneous effect on the majority of economic variables, but it does not affect the environmental quality immediately. In addition, we tested the Porter hypothesis and found no evidence suggesting the statement regarding this hypothesis. Finally, we applied Bayesian estimation to assure our findings in this study, again.

Review of recent progress of emission trading policy in China

This paper considers the influence of different carbon emission policies for liner shipping. The transportation optimization models under four different forms of carbon emission policies (no carbon emissions constraints, carbon emissions tax, carbon caps, and carbon cap-and-trade) are developed. A real case is given to demonstrate the effectiveness of the proposed models and comparative analysis of the impact of different carbon emission policies on shipowner’s profit and ship carbon emission. It is shown that the carbon caps form is the most direct method for reducing emission; the form of carbon emissions tax is a mandatory measure, which has the greatest impact on the profit of shipping companies; carbon cap-and-trade forms have weaker emission reduction effects, it is easier for enterprises to actively implement emission reductions and be highly motivated in the long run.

Sailing speed optimization in voyage chartering ship considering different carbon emissions taxation