UCL Department of Economics


Finance Seminar - Per Stromberg (SSE)

03 May 2023, 4:00 pm–5:15 pm

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The Effect of Carbon Pricing on Firm Emissions: Evidence from the Swedish CO2 Tax

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Ming Yang

Abstract: Sweden was one of the first countries to introduce a carbon tax in 1991. We assemble a unique dataset 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, albeit 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.

Location: B20 Jevons Lecture Theatre, Drayton House or Zoom


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