International competitiveness and markets

Kuik et al. (2013)_International Competitiveness

This report assesses the effects of the current policy mix on international competitiveness and markets. The report starts with the development of an analytical framework of competitiveness, which is largely based on works of the Organisation of Economic Co-operation and Development (OECD) and the European Commission. Secondly, it provides a comprehensive review of literature on the relationship between climate policy and industrial competitiveness, with a focus on Europe. Thirdly, the report assesses the effects of the current policy mix on emerging international markets, such as the international ‘carbon’ market and the international market for renewable energy technologies. The report provides empirical information but also discusses methodological and empirical challenges of identification and measurement of the effects of policy mixes on competitiveness and markets.

Two important key messages of this report are:

there are various channels in which environmental policies can affect the competitiveness of firms, both in positive and negative ways;
indicators measure determinants or consequences of competitiveness, but as yet there is no complete theory that tells us how to select the most important determinants and consequences and how determinants and consequences are exactly related.

Attachment:

CECILIA2050 Task 2.8. - International Competitiveness & Markets.pdf

Citation:

Kuik, Onno; Branger, Frédéric; Quirion, Philippe. 2013. International competitiveness and markets. CECILIA2050 WP2 Deliverable 2.8. Amsterdam: Institute for Environmental Studies, Paris: Centre International de Recherche sur l’Environnement et le Développement.

Funding:

European Commission

Authors:

Dr Onno Kuik, Institute for Environmental Studies, VU University Amsterdam, Frédéric Branger, SMASH-CIRED, Dr Philippe Quirion, SMASH-CIRED, CNRS

Year of publication:

2014

Number of pages:

1	Executive summary	7
2	Introduction	7
3	Competitiveness – analytical framework	8
3.1	Introduction	8
3.2	OECD analytical framework	9
3.3	Competitiveness in EU legislation	12
3.4	Indicators of competitiveness	13
4	Climate policy and international competitiveness	15
4.1	Introduction	15
4.2	Definitions	16
4.2.1	Carbon leakage	16
4.2.2	Competitiveness	17
4.2.3	Sectors at risk	18
4.3	Positive impacts of climate policies on competitiveness and abatement in foreign countries	19
4.4	Evaluation of carbon leakage	21
4.4.1	Ex ante studies	21
4.4.2	Ex post studies	24
4.4.3	Synthesis	25
4.4.4	Global approach	26
4.4.5	Levelling down the cost of carbon	27
4.4.6	Border adjustments	27
4.5	Conclusion	30
5	Effects of the current policy mix on key international markets	32
5.1	Introduction	32
5.2	Carbon market	32
5.3	Renewable energy market	35
5.4	Conclusion	39
6	Conclusions	39
7	References	41