Taxes vs Permits: Options for Price-Based Climate Change Regulation
New Zealand Treasury Working Paper 05/02
Published March 2005
Authors: Isabelle Sin and Suzi Kerr with Joanna Hendy
This paper provides an overview of key issues involved in the choice among market-based instruments for climate change policy. Specifically, it examines the potential net benefits from shifting to a permit system for emission reduction, and the preconditions necessary for this change. It also draws out the implications of New Zealand’s specific circumstances and current climate policies for future policy development.
We would like to thank Steve Rylands, Kevin Guerin and Joanna Smith at Treasury and Billy Pizer at Resources for the Future for useful comments. This work draws on Motu’s FRST funded project ‘Land use, climate change and Kyoto’, and involves indirect input from Landcare, Forest Research and AgResearch. The authors are responsible for all opinions expressed and all errors and omissions that remain.
This document was commissioned by the New Zealand Treasury. However, the views, opinions, findings and conclusions or recommendations expressed in it are strictly those of the author(s), do not necessarily represent and should not be reported as those of the New Zealand Treasury. The New Zealand Treasury takes no responsibility for any errors, omissions in, or for the correctness of, the information contained in this Paper.
- Joanna Hendy is the primary author of section 6.2 but does not take responsibility for the document as a whole.