The Cost of Adjustment to Green Growth Policies : Lessons from Trade Adjustment Costs

Green growth policies confront firms and workers with adjustments that may create welfare costs for different segments of the population and cause reductions in near-term actual versus potential gross domestic product. There is little evidence on t...

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Bibliographic Details
Main Author: Porto, Guido
Format: Policy Research Working Paper
Language:English
en_US
Published: World Bank, Washington, DC 2013
Subjects:
GDP
WTO
Online Access:http://documents.worldbank.org/curated/en/2012/10/16862151/cost-adjustment-green-growth-policies-lessons-trade-adjustment-costs
http://hdl.handle.net/10986/12079
id okr-10986-12079
recordtype oai_dc
repository_type Digital Repository
institution_category Foreign Institution
institution Digital Repositories
building World Bank Open Knowledge Repository
collection World Bank
language English
en_US
topic ADJUSTMENT ASSISTANCE
ADJUSTMENT COST
ADJUSTMENT COSTS
ADJUSTMENT POLICIES
ADJUSTMENT PROCESS
AGGREGATE INCOME
AGRICULTURE
AVERAGE WAGE
AVERAGE WAGES
BARGAINING POWER
BENCHMARK
CAPITAL ACCUMULATION
CAPITAL MARKET
CAPITAL MARKETS
CAPITAL STOCK
CARBON
CARBON ENERGY
CHILD LABOR
CLIMATE CHANGE
COAL
CODES OF CONDUCT
COMPARATIVE ADVANTAGE
COMPETITIVE ADVANTAGE
COMPLIANCE COSTS
CONSUMERS
CREDIT CONSTRAINTS
DAMAGES
DEADWEIGHT
DEADWEIGHT LOSS
DEMOGRAPHIC
DEMOGRAPHICS
DEVELOPING COUNTRIES
DEVELOPING ECONOMIES
DEVELOPMENT ECONOMICS
DEVELOPMENT POLICY
DISCOUNT RATE
DISCOUNTED VALUE
DISPLACED WORKERS
DRIVERS
EARNING
ECONOMETRICS
ECONOMIC ACTIVITY
ECONOMIC RESEARCH
EFFICIENCY WAGES
ELASTICITY
EMISSIONS
EMPIRICAL EVIDENCE
EMPLOYEE
EMPLOYMENT EFFECTS
EMPLOYMENT LEVELS
EMPLOYMENT RESEARCH
EMPLOYMENT SUBSIDIES
EMPLOYMENT TURNOVER
ENERGY EFFICIENCY
ENVIRONMENTAL
ENVIRONMENTAL DAMAGES
ENVIRONMENTAL POLICIES
ENVIRONMENTAL QUALITY
ENVIRONMENTAL RESOURCES
ENVIRONMENTAL STANDARDS
EQUILIBRIUM
EXPLOITATION
EXPORT MARKET
EXPORT-ORIENTED INDUSTRY
EXPORTS
EXTERNALITIES
EXTERNALITY
FACTOR MARKETS
FACTORS OF PRODUCTION
FAIR TRADE
FIRING COSTS
FIRM SURVEYS
FIXED CAPITAL
FIXED INVESTMENT
FOSSIL FUELS
FREE TRADE
FRICTIONAL UNEMPLOYMENT
GDP
GENERAL EQUILIBRIUM
GENERAL EQUILIBRIUM MODELS
GROWTH MODELS
GROWTH POLICIES
GROWTH POLICY
HOME COUNTRY
HOUSEHOLD INCOME
HOUSEHOLD SURVEY
HOUSEHOLD SURVEYS
HUMAN CAPITAL
HUMAN RIGHTS
HUMAN RIGHTS ISSUES
IMPROVED WORKING CONDITIONS
INCOME
INCOME INEQUALITY
INCOMES
INDUSTRY WAGE
INPUT PRICES
INSURANCE MARKETS
INTANGIBLE
INTERNATIONAL TRADE
INVESTMENT CLIMATE
IRREVERSIBILITY
JOB DISPLACEMENT
JOB TRAINING
JOBS
LABOR ADJUSTMENT
LABOR ADJUSTMENT COSTS
LABOR ALLOCATION
LABOR ALLOCATIONS
LABOR DEMAND
LABOR DISPLACEMENT
LABOR FORCE
LABOR MARKET
LABOR MARKET ADJUSTMENT
LABOR MARKET FLEXIBILITY
LABOR MARKET POLICIES
LABOR MARKET REFORM
LABOR MARKET REFORMS
LABOR MARKET RIGIDITIES
LABOR MARKET TURNOVER
LABOR MARKETS
LABOR MOBILITY
LABOR PRODUCTIVITY
LABOR REALLOCATION
LABOR REGULATIONS
LABOR SUPPLY
LABOR UNIONS
LABOUR
LABOUR ADJUSTMENT
LABOUR MARKET
LABOUR MARKET REGULATIONS
LABOUR MOVEMENTS
LONG-RUN EMPLOYMENT
MARGINAL PRODUCT
MARGINAL PRODUCTIVITY
MARKET DISTORTION
MARKET DISTORTIONS
MARKET LIBERALIZATION
MIDDLE-INCOME COUNTRIES
MINIMUM WAGE
MINIMUM WAGES
NEW MARKET
NEW MARKET OPPORTUNITIES
NOMINAL WAGES
OLDER WORKERS
OPTIMIZATION
OPTION VALUE
OUTPUTS
POLICY MAKERS
POLITICAL ECONOMY
POLLUTION
POLLUTION TAX
POTENTIAL GROSS DOMESTIC PRODUCT
PRESENT VALUE
PREVIOUS SECTION
PRODUCERS
PRODUCTION FUNCTION
PRODUCTION WORKER
PRODUCTIVE ACTIVITIES
PRODUCTIVE FIRMS
PRODUCTIVITY
PRODUCTIVITY GAIN
PRODUCTIVITY GAINS
PROFIT MAXIMIZATION
PROFIT SHARING
PROTECTED INDUSTRIES
PROTECTED INDUSTRY
QUOTAS
RATIONAL EXPECTATIONS
REAL WAGE
REAL WAGES
RENTS
SAFETY
SAFETY NET
SELLING PRICE
SKILL PREMIUM
SKILL PREMIUMS
SKILL UPGRADING
SOCIAL BENEFITS
STARTUP
STRUCTURAL ADJUSTMENT
SUSTAINABLE DEVELOPMENT
TARGETED EMPLOYMENT SUBSIDY
TAXATION
TERMS OF TRADE
TRADE LIBERALIZATION
TRADE POLICIES
TRADE POLICY
TRADE REFORMS
TRAINING COSTS
UNEMPLOYED
UNEMPLOYED WORKER
UNEMPLOYED WORKERS
UNEMPLOYMENT
UNEMPLOYMENT INSURANCE
UNEMPLOYMENT INSURANCE PROGRAM
UNEMPLOYMENT TRANSITION
UNPROTECTED SECTOR
UNSKILLED LABOR
UNSKILLED WORKERS
URUGUAY ROUND
UTILITY FUNCTION
VALUE OF OUTPUT
VERTICAL INTEGRATION
VOLATILITY
WAGE BARGAINING
WAGE DIFFERENTIALS
WAGE GROWTH
WAGE INCREASE
WAGE INCREASES
WAGE INEQUALITY
WAGE LEVELS
WAGE PREMIUM
WAGE PREMIUMS
WAGE STRUCTURE
WAGE SUBSIDIES
WAGES
WELFARE EFFECTS
WELFARE GAINS
WORKERS
WORKING CONDITIONS
WORLD TRADE
WTO
YOUNG WORKERS
spellingShingle ADJUSTMENT ASSISTANCE
ADJUSTMENT COST
ADJUSTMENT COSTS
ADJUSTMENT POLICIES
ADJUSTMENT PROCESS
AGGREGATE INCOME
AGRICULTURE
AVERAGE WAGE
AVERAGE WAGES
BARGAINING POWER
BENCHMARK
CAPITAL ACCUMULATION
CAPITAL MARKET
CAPITAL MARKETS
CAPITAL STOCK
CARBON
CARBON ENERGY
CHILD LABOR
CLIMATE CHANGE
COAL
CODES OF CONDUCT
COMPARATIVE ADVANTAGE
COMPETITIVE ADVANTAGE
COMPLIANCE COSTS
CONSUMERS
CREDIT CONSTRAINTS
DAMAGES
DEADWEIGHT
DEADWEIGHT LOSS
DEMOGRAPHIC
DEMOGRAPHICS
DEVELOPING COUNTRIES
DEVELOPING ECONOMIES
DEVELOPMENT ECONOMICS
DEVELOPMENT POLICY
DISCOUNT RATE
DISCOUNTED VALUE
DISPLACED WORKERS
DRIVERS
EARNING
ECONOMETRICS
ECONOMIC ACTIVITY
ECONOMIC RESEARCH
EFFICIENCY WAGES
ELASTICITY
EMISSIONS
EMPIRICAL EVIDENCE
EMPLOYEE
EMPLOYMENT EFFECTS
EMPLOYMENT LEVELS
EMPLOYMENT RESEARCH
EMPLOYMENT SUBSIDIES
EMPLOYMENT TURNOVER
ENERGY EFFICIENCY
ENVIRONMENTAL
ENVIRONMENTAL DAMAGES
ENVIRONMENTAL POLICIES
ENVIRONMENTAL QUALITY
ENVIRONMENTAL RESOURCES
ENVIRONMENTAL STANDARDS
EQUILIBRIUM
EXPLOITATION
EXPORT MARKET
EXPORT-ORIENTED INDUSTRY
EXPORTS
EXTERNALITIES
EXTERNALITY
FACTOR MARKETS
FACTORS OF PRODUCTION
FAIR TRADE
FIRING COSTS
FIRM SURVEYS
FIXED CAPITAL
FIXED INVESTMENT
FOSSIL FUELS
FREE TRADE
FRICTIONAL UNEMPLOYMENT
GDP
GENERAL EQUILIBRIUM
GENERAL EQUILIBRIUM MODELS
GROWTH MODELS
GROWTH POLICIES
GROWTH POLICY
HOME COUNTRY
HOUSEHOLD INCOME
HOUSEHOLD SURVEY
HOUSEHOLD SURVEYS
HUMAN CAPITAL
HUMAN RIGHTS
HUMAN RIGHTS ISSUES
IMPROVED WORKING CONDITIONS
INCOME
INCOME INEQUALITY
INCOMES
INDUSTRY WAGE
INPUT PRICES
INSURANCE MARKETS
INTANGIBLE
INTERNATIONAL TRADE
INVESTMENT CLIMATE
IRREVERSIBILITY
JOB DISPLACEMENT
JOB TRAINING
JOBS
LABOR ADJUSTMENT
LABOR ADJUSTMENT COSTS
LABOR ALLOCATION
LABOR ALLOCATIONS
LABOR DEMAND
LABOR DISPLACEMENT
LABOR FORCE
LABOR MARKET
LABOR MARKET ADJUSTMENT
LABOR MARKET FLEXIBILITY
LABOR MARKET POLICIES
LABOR MARKET REFORM
LABOR MARKET REFORMS
LABOR MARKET RIGIDITIES
LABOR MARKET TURNOVER
LABOR MARKETS
LABOR MOBILITY
LABOR PRODUCTIVITY
LABOR REALLOCATION
LABOR REGULATIONS
LABOR SUPPLY
LABOR UNIONS
LABOUR
LABOUR ADJUSTMENT
LABOUR MARKET
LABOUR MARKET REGULATIONS
LABOUR MOVEMENTS
LONG-RUN EMPLOYMENT
MARGINAL PRODUCT
MARGINAL PRODUCTIVITY
MARKET DISTORTION
MARKET DISTORTIONS
MARKET LIBERALIZATION
MIDDLE-INCOME COUNTRIES
MINIMUM WAGE
MINIMUM WAGES
NEW MARKET
NEW MARKET OPPORTUNITIES
NOMINAL WAGES
OLDER WORKERS
OPTIMIZATION
OPTION VALUE
OUTPUTS
POLICY MAKERS
POLITICAL ECONOMY
POLLUTION
POLLUTION TAX
POTENTIAL GROSS DOMESTIC PRODUCT
PRESENT VALUE
PREVIOUS SECTION
PRODUCERS
PRODUCTION FUNCTION
PRODUCTION WORKER
PRODUCTIVE ACTIVITIES
PRODUCTIVE FIRMS
PRODUCTIVITY
PRODUCTIVITY GAIN
PRODUCTIVITY GAINS
PROFIT MAXIMIZATION
PROFIT SHARING
PROTECTED INDUSTRIES
PROTECTED INDUSTRY
QUOTAS
RATIONAL EXPECTATIONS
REAL WAGE
REAL WAGES
RENTS
SAFETY
SAFETY NET
SELLING PRICE
SKILL PREMIUM
SKILL PREMIUMS
SKILL UPGRADING
SOCIAL BENEFITS
STARTUP
STRUCTURAL ADJUSTMENT
SUSTAINABLE DEVELOPMENT
TARGETED EMPLOYMENT SUBSIDY
TAXATION
TERMS OF TRADE
TRADE LIBERALIZATION
TRADE POLICIES
TRADE POLICY
TRADE REFORMS
TRAINING COSTS
UNEMPLOYED
UNEMPLOYED WORKER
UNEMPLOYED WORKERS
UNEMPLOYMENT
UNEMPLOYMENT INSURANCE
UNEMPLOYMENT INSURANCE PROGRAM
UNEMPLOYMENT TRANSITION
UNPROTECTED SECTOR
UNSKILLED LABOR
UNSKILLED WORKERS
URUGUAY ROUND
UTILITY FUNCTION
VALUE OF OUTPUT
VERTICAL INTEGRATION
VOLATILITY
WAGE BARGAINING
WAGE DIFFERENTIALS
WAGE GROWTH
WAGE INCREASE
WAGE INCREASES
WAGE INEQUALITY
WAGE LEVELS
WAGE PREMIUM
WAGE PREMIUMS
WAGE STRUCTURE
WAGE SUBSIDIES
WAGES
WELFARE EFFECTS
WELFARE GAINS
WORKERS
WORKING CONDITIONS
WORLD TRADE
WTO
YOUNG WORKERS
Porto, Guido
The Cost of Adjustment to Green Growth Policies : Lessons from Trade Adjustment Costs
relation Policy Research Working Paper;No. 6237
description Green growth policies confront firms and workers with adjustments that may create welfare costs for different segments of the population and cause reductions in near-term actual versus potential gross domestic product. There is little evidence on the cost of adjustment to climate change measures, and only limited evidence for more general environmental policies, especially in developing countries. Therefore, this paper canvasses the research on adjustment costs to trade policies to draw analogies and highlight differences compared with the potential impacts of green growth policies. Trade policies affect prices and work directly on technology choice. In the presence of adjustment costs, firms may experience impacts on wages, employment, and incentives to adopt alternative technologies. Both types of trade policy impacts may be amplified by technology availability and credit constraints. Many green growth policies are likely to work via the same mechanisms, that is, taxes on emissions or changes in technology requirements. However, trade liberalization is typically seen as offering higher total incomes, albeit with winners and losers. Green growth policies are thought of as welfare-enhancing at the collective level but may not be income-enhancing at the individual level. This implies much more difficulty in measuring the potential gains associated with green growth policies.
format Publications & Research :: Policy Research Working Paper
author Porto, Guido
author_facet Porto, Guido
author_sort Porto, Guido
title The Cost of Adjustment to Green Growth Policies : Lessons from Trade Adjustment Costs
title_short The Cost of Adjustment to Green Growth Policies : Lessons from Trade Adjustment Costs
title_full The Cost of Adjustment to Green Growth Policies : Lessons from Trade Adjustment Costs
title_fullStr The Cost of Adjustment to Green Growth Policies : Lessons from Trade Adjustment Costs
title_full_unstemmed The Cost of Adjustment to Green Growth Policies : Lessons from Trade Adjustment Costs
title_sort cost of adjustment to green growth policies : lessons from trade adjustment costs
publisher World Bank, Washington, DC
publishDate 2013
url http://documents.worldbank.org/curated/en/2012/10/16862151/cost-adjustment-green-growth-policies-lessons-trade-adjustment-costs
http://hdl.handle.net/10986/12079
_version_ 1764418950914899968
spelling okr-10986-120792021-04-23T14:02:59Z The Cost of Adjustment to Green Growth Policies : Lessons from Trade Adjustment Costs Porto, Guido ADJUSTMENT ASSISTANCE ADJUSTMENT COST ADJUSTMENT COSTS ADJUSTMENT POLICIES ADJUSTMENT PROCESS AGGREGATE INCOME AGRICULTURE AVERAGE WAGE AVERAGE WAGES BARGAINING POWER BENCHMARK CAPITAL ACCUMULATION CAPITAL MARKET CAPITAL MARKETS CAPITAL STOCK CARBON CARBON ENERGY CHILD LABOR CLIMATE CHANGE COAL CODES OF CONDUCT COMPARATIVE ADVANTAGE COMPETITIVE ADVANTAGE COMPLIANCE COSTS CONSUMERS CREDIT CONSTRAINTS DAMAGES DEADWEIGHT DEADWEIGHT LOSS DEMOGRAPHIC DEMOGRAPHICS DEVELOPING COUNTRIES DEVELOPING ECONOMIES DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DISCOUNT RATE DISCOUNTED VALUE DISPLACED WORKERS DRIVERS EARNING ECONOMETRICS ECONOMIC ACTIVITY ECONOMIC RESEARCH EFFICIENCY WAGES ELASTICITY EMISSIONS EMPIRICAL EVIDENCE EMPLOYEE EMPLOYMENT EFFECTS EMPLOYMENT LEVELS EMPLOYMENT RESEARCH EMPLOYMENT SUBSIDIES EMPLOYMENT TURNOVER ENERGY EFFICIENCY ENVIRONMENTAL ENVIRONMENTAL DAMAGES ENVIRONMENTAL POLICIES ENVIRONMENTAL QUALITY ENVIRONMENTAL RESOURCES ENVIRONMENTAL STANDARDS EQUILIBRIUM EXPLOITATION EXPORT MARKET EXPORT-ORIENTED INDUSTRY EXPORTS EXTERNALITIES EXTERNALITY FACTOR MARKETS FACTORS OF PRODUCTION FAIR TRADE FIRING COSTS FIRM SURVEYS FIXED CAPITAL FIXED INVESTMENT FOSSIL FUELS FREE TRADE FRICTIONAL UNEMPLOYMENT GDP GENERAL EQUILIBRIUM GENERAL EQUILIBRIUM MODELS GROWTH MODELS GROWTH POLICIES GROWTH POLICY HOME COUNTRY HOUSEHOLD INCOME HOUSEHOLD SURVEY HOUSEHOLD SURVEYS HUMAN CAPITAL HUMAN RIGHTS HUMAN RIGHTS ISSUES IMPROVED WORKING CONDITIONS INCOME INCOME INEQUALITY INCOMES INDUSTRY WAGE INPUT PRICES INSURANCE MARKETS INTANGIBLE INTERNATIONAL TRADE INVESTMENT CLIMATE IRREVERSIBILITY JOB DISPLACEMENT JOB TRAINING JOBS LABOR ADJUSTMENT LABOR ADJUSTMENT COSTS LABOR ALLOCATION LABOR ALLOCATIONS LABOR DEMAND LABOR DISPLACEMENT LABOR FORCE LABOR MARKET LABOR MARKET ADJUSTMENT LABOR MARKET FLEXIBILITY LABOR MARKET POLICIES LABOR MARKET REFORM LABOR MARKET REFORMS LABOR MARKET RIGIDITIES LABOR MARKET TURNOVER LABOR MARKETS LABOR MOBILITY LABOR PRODUCTIVITY LABOR REALLOCATION LABOR REGULATIONS LABOR SUPPLY LABOR UNIONS LABOUR LABOUR ADJUSTMENT LABOUR MARKET LABOUR MARKET REGULATIONS LABOUR MOVEMENTS LONG-RUN EMPLOYMENT MARGINAL PRODUCT MARGINAL PRODUCTIVITY MARKET DISTORTION MARKET DISTORTIONS MARKET LIBERALIZATION MIDDLE-INCOME COUNTRIES MINIMUM WAGE MINIMUM WAGES NEW MARKET NEW MARKET OPPORTUNITIES NOMINAL WAGES OLDER WORKERS OPTIMIZATION OPTION VALUE OUTPUTS POLICY MAKERS POLITICAL ECONOMY POLLUTION POLLUTION TAX POTENTIAL GROSS DOMESTIC PRODUCT PRESENT VALUE PREVIOUS SECTION PRODUCERS PRODUCTION FUNCTION PRODUCTION WORKER PRODUCTIVE ACTIVITIES PRODUCTIVE FIRMS PRODUCTIVITY PRODUCTIVITY GAIN PRODUCTIVITY GAINS PROFIT MAXIMIZATION PROFIT SHARING PROTECTED INDUSTRIES PROTECTED INDUSTRY QUOTAS RATIONAL EXPECTATIONS REAL WAGE REAL WAGES RENTS SAFETY SAFETY NET SELLING PRICE SKILL PREMIUM SKILL PREMIUMS SKILL UPGRADING SOCIAL BENEFITS STARTUP STRUCTURAL ADJUSTMENT SUSTAINABLE DEVELOPMENT TARGETED EMPLOYMENT SUBSIDY TAXATION TERMS OF TRADE TRADE LIBERALIZATION TRADE POLICIES TRADE POLICY TRADE REFORMS TRAINING COSTS UNEMPLOYED UNEMPLOYED WORKER UNEMPLOYED WORKERS UNEMPLOYMENT UNEMPLOYMENT INSURANCE UNEMPLOYMENT INSURANCE PROGRAM UNEMPLOYMENT TRANSITION UNPROTECTED SECTOR UNSKILLED LABOR UNSKILLED WORKERS URUGUAY ROUND UTILITY FUNCTION VALUE OF OUTPUT VERTICAL INTEGRATION VOLATILITY WAGE BARGAINING WAGE DIFFERENTIALS WAGE GROWTH WAGE INCREASE WAGE INCREASES WAGE INEQUALITY WAGE LEVELS WAGE PREMIUM WAGE PREMIUMS WAGE STRUCTURE WAGE SUBSIDIES WAGES WELFARE EFFECTS WELFARE GAINS WORKERS WORKING CONDITIONS WORLD TRADE WTO YOUNG WORKERS Green growth policies confront firms and workers with adjustments that may create welfare costs for different segments of the population and cause reductions in near-term actual versus potential gross domestic product. There is little evidence on the cost of adjustment to climate change measures, and only limited evidence for more general environmental policies, especially in developing countries. Therefore, this paper canvasses the research on adjustment costs to trade policies to draw analogies and highlight differences compared with the potential impacts of green growth policies. Trade policies affect prices and work directly on technology choice. In the presence of adjustment costs, firms may experience impacts on wages, employment, and incentives to adopt alternative technologies. Both types of trade policy impacts may be amplified by technology availability and credit constraints. Many green growth policies are likely to work via the same mechanisms, that is, taxes on emissions or changes in technology requirements. However, trade liberalization is typically seen as offering higher total incomes, albeit with winners and losers. Green growth policies are thought of as welfare-enhancing at the collective level but may not be income-enhancing at the individual level. This implies much more difficulty in measuring the potential gains associated with green growth policies. 2013-01-03T22:54:05Z 2013-01-03T22:54:05Z 2012-10 http://documents.worldbank.org/curated/en/2012/10/16862151/cost-adjustment-green-growth-policies-lessons-trade-adjustment-costs http://hdl.handle.net/10986/12079 English en_US Policy Research Working Paper;No. 6237 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research