Modelling the effects of energy taxes on ecological footprint transfers in China's foreign trade

Abstract

Significant inter-country transfers of ecological footprint are embodied in foreign trade. Previous research on these transfers mainly focused on historical characteristics of the flows based on historical data. However, the transfers of ecological footprints in foreign trade are dynamic and are influenced by environmental tax policies, whose future impacts have seldom been considered. In the present study, we explored the effects of an energy tax, a common form of environmental tax, on these transfers. We combined a multi-sector dynamic computable general equilibrium model with ecological footprint assessment, and analyzed the changes in the actual and virtual land uses that comprise the ecological footprint under different tax intensities. We used China as a case study to analyze the energy tax's effects. For the actual land use component of the ecological footprint, the energy tax increased the export of ecological footprint but decreased its import, and China's average net exports (exports minus imports) decreased by 4.56 × 106 gha (global hectares) and 10.81 × 106 gha from 2015 to 2020 under the low and high tax intensities, respectively. For the virtual land use component of the ecological footprint, the energy tax simultaneously decreased export and import of this footprint component; the average net import would increase by 3.84 × 106 gha and 8.91 × 106 gha. For the total ecological footprint, the energy tax also simultaneously reduced export and import, with the net import decreasing by 1.76 × 106 gha and 4.45 × 106 gha under the low and high taxes, respectively.