This is a presentation of the initial stage of my joint work with a colleague. I presented it in December last year at Yonsei university.

1. REDUCING POLLUTION LEVELS
BY THE OECD COUNTRIES:
WHICH COUNTRIES SHOULD BEAR THE BRUNT?
December 7, 2012
Alexandre Repkine

2. COPENHAGEN ACCORD
 United Nations Framework Convention on
Climate Change
 120 countries
 EU
 Pledges to reduce CO2 emission levels by 2020
 Opportunity costs are a problem

3. CO2 REDUCTION VERSUS GDP
 Reducing CO2 levels comes at an opportunity cost
 Direct investment outlays for cleaning equipment
 Multiplier effect
 What is the opportunity cost of reducing CO2 emissions by 1 ton in
terms of the foregone GDP?
 Tempting to require each country to reduce its CO2 emission levels
by a uniform fraction, but is it the cheapest way?
 Fairness dimensions
 Fairness in terms of the GDP opportunity costs
 Fairness in terms of the individual reduction targets
 Fairness in terms of the overall contribution

4. MEASURING OPPORTUNITY COSTS OF CO2
REDUCTION IN TERMS OF GDP
 is the production
Px 
possibilities set: contains all
combinations of real GDP and CO2
PPF emissions reduction feasible if the

vector of inputs x is used.
CD
OC  Point A: current combination of
DE
GDP and level of CO2 emissions
E reduction, inefficient
D
Points B, C: efficient production
If a country is producing efficiently
at point C on the PPF, the only way
to reduce CO2 emissions by DE is to
sacrifice some portion of GDP CD

5. QUESTIONS TO ANSWER
 What is the size of the costless reduction of
CO2 in the OECD countries?
 What are the GDP opportunity costs of CO2
reduction for individual countries?
 Which countries reduce CO2 cheaply?
 Which countries reduce CO2 expensively?
 What are the alternative scenarios of reducing
CO2 in the OECD countries?

6. ESTIMATION METHODOLOGY
 Fare et al. (1993), Shephard’s duality lemma:
the opportunity costs of any two outputs can be
measured as a ratio of the two inputs’ shadow
prices
 Equivalent to computing the slope of the PPF in
the two-dimensional space
 Key assumption: one output’s shadow price is
equal to its market price

7. ESTIMATION METHODOLOGY
O
c
 Main inference tool: pc  p y
O
y
 pc = shadow price of carbon dioxide reduction
 p = shadow price of another output, assumed
y
equal to its market price

   
Ox, y   inf  :  Px  = output distance function
y

  
mapping inputs and outputs
into the radial efficiency
measure in terms of outputs

8. EMPIRICAL FRAMEWORK
 Distance function is specified in terms of
mapping of inputs and outputs into a radial
efficiency measure   0,1
 Inputs: capital (USD), labor, energy (kt oil eq.)
 Outputs: real GDP (USD), CO2 emissions (tons)

9. EMPIRICAL FRAMEWORK
 Translog specification of the distance function:
Y K Y Y K K Y K
ln Ox, y    0   i ln yi   i ln xk    ij ln yi ln y j  ij ln xi ln x j   ij ln yi ln x j
i 1 i 1 i 1 j 1 i 1 j 1 i 1 j 1
 Homogeneity of degree 1 in outputs:   Y
i 1
 Symmetry assumptions:
i 1
Y Y Y K
 0  0 
i 1 j 1
ij 
i 1 j 1
ij
 ij   ji ,ij   ji , ij   ji
Y=number of outputs, K=number of inputs

10. ESTIMATION OF DISTANCE FUNCTION
 The translog distance function parameters are
estimated by solving a linear program:


    
 Max  ln O  x , y  Ox , y  = distance function
s.t.

  
ln O  x , y   0 Efficiency measure is within [0,1]
 
  ln O  x , y 
  0, i  1..Y Non-negative shadow price of real GDP
  ln yi
 
  ln O  x , y 
  0, i  1..K Non-positive shadow price of CO2
  ln xi
 emissions

11. SHADOW COST OF REDUCING CO2
 ln O  ln O
 ln c   ln y c dy dy y  ln c
  
 ln O  ln c y dc dc c  ln O
 ln y  ln y
 The shadow cost of CO2 reduction by 1 ton
varies with the values of real GDP and CO2
emissions
 We assume that the shadow price of the real
GDP is equal to its market price, which is $1
by definition

12. DATA SOURCES
 Penn World Table: Heston et al. (2011)
 Constant prices GDP, USD
 Constant prices investment flows, USD
 Labor, number of people
 World Bank Indicators database: WDI (2012)
 CO2 emissions, kilotons
 Energy use, oil equivalent, kilotons

13. DATA SUMMARY
GDP (bn USD) CO2 Population (mn Capital (bn USD) Energy use
(kt) people) (kt of oil equivalent)
Australia 718.25 356798 19.79 1687.44 113988
Austria 283.99 67351 8.15 719.04 31090
: top five
Belgium 335.91 112202 10.32 859.99 57907
Canada 1092.54 530567 31.91 2217.44 255432
Chile 160.71 60074 15.63 306.72 25762
US, Germany,
Denmark 179.32 53535 5.39 412.44 19702 Japan
Finland
France
155.56
1871.50
60038
388751
5.19
62.31
383.65
4005.94
34302
260107
consistent
Germany 2596.81 830298 82.27 6136.73 341537 “leaders”
Greece 246.47 94811 10.65 604.27 27908
Hungary 148.06 59508 10.13 314.39 26225
Iceland 11.19 2197 0.29 27.90 3611 US accounts for
Ireland
Israel
142.32
149.12
41403
59380
3.99
6.44
302.41
324.34
13848
19389
40% of OECD
Italy 1687.91 463280 58.74 4420.39 173087 CO2 emissionss
Japan 3900.31 1300000 127.38 12703.24 512432
Korea 989.01 453773 47.56 3130.47 199010
Luxembourg 30.65 9248 0.45 65.10 3703 CO2 emissions
Mexico 1160.16 414986 103.69 2522.74 157121
related to GDP,
Netherlands 573.14 176656 16.21 1185.57 76729
Zealand 100.38 32764 3.96 188.31 16814 R2=96%
Norway 211.30 40545 4.53 487.78 26176
Poland 484.51 329449 38.76 824.79 96161
Portugal 202.93 61475 10.45 554.80 24182
Spain 1132.06 315656 42.69 2879.35 126318
Sweden 283.94 52484 8.99 508.73 50636
Switzerland 270.92 41364 7.41 769.09 26016
Turkey 619.87 228128 70.40 969.77 81938
Source: Heston et al. (2011) Penn World Tables, World Bank Development Indicators (2011); 2005 constant USD where applicable 217655
UK 1885.89 543156 60.05 3148.59

14. EFFICIENT EMISSIONS:
SPEARMAN RANK CORRELATION STATISTICS
Kg CO2 Kg CO2 Kg Energy Kg CO2 per GDP
per capita per $1 GDP Use Kg of oil per capita Spearman rank correlation
per $1 GDP equivalent statistics capture non-linear
energy use relationships, too
Kg CO2 36.65%*** 16.23*** 17.62%*** 55.49*** Richer in terms of per
per capita capita GDP also means
Kg CO2 36.65%*** 52.03%*** 55.69%*** -15.54%*** more CO2 per capita
per $1 GDP
However, wealthier
countries are emitting and
Kg Energy Use 16.23*** 52.03%*** -28.66%*** -15.54%*** using energy more
per $1 GDP efficiently
Kg CO2 per Kg 17.62%*** 55.69%*** -28.66%*** -35.62%***
of oil Using more energy per $1
equivalent GDP associated with less
energy use CO2 emissions per $1 USD
GDP per capita 55.49*** -44.12%*** -15.54%*** -35.62%***

15. DISTANCE FUNCTION PARAMETERS
Parameter, logs Estimate Parameter, logs Estimate
Constant -14.38 Constant 0.003
GDP 0.93 GDP 0.003
CO2 Emissions 0.07 CO2 Emissions 0.011
Capital 0.18 Capital -0.03
Labor -0.33 Labor -0.03
Energy Use -0.93 Energy Use -0.004
Squared Capital 0.01 Squared Capital 0.02
Squared Labor 0.003 Squared Labor 0.004
Squared Energy Use -0.003 Squared Energy Use 0.01
Squared CO2 -0.002 Squared CO2 0.002
Squared GDP -0.0006 Squared GDP

16. CO2 ABATEMENT COSTS
Distance Function Marginal Abatement Costs
(% distance from efficient frontier)
Average SD Min Max Average SD
(USD/ton CO2)
Min Max Hungary, Korea and
Australia
Austria
99.43%
99.80%
0.13%
0.03%
99.15%
99.74%
99.58%
99.85%
538.93
2139.63
271.40
607.66
214.96
1328.01
1155.72
3336.28
Poland producing least
Belgium 99.42% 0.18% 99.10% 99.64% 636.90 221.14 370.96 1044.57 efficiently
Canada 99.21% 0.27% 98.68% 99.51% 131.59 67.05 43.60 268.88
Chile 99.35% 0.28% 98.75% 100.00% 127.06 59.86 41.88 223.76
Denmark
Finland
99.79%
99.10%
0.10%
0.30%
99.57%
98.52%
99.96%
99.53%
1511.78
377.58
761.45
83.02
480.45
284.64
2879.65
569.60
Large variation in
France
Germany
99.51%
99.52%
0.12%
0.12%
99.26%
99.31%
99.65%
99.67%
74.19
477.42
75.00
108.06
0.00
327.58
283.78
722.65
abatement costs: $52
Greece
Hungary
99.67%
98.92%
0.06%
0.48%
99.54%
98.03%
99.78%
99.47%
843.20
208.93
277.35
56.58
531.87
124.82
1371.30
304.83
per ton for US,
Iceland 99.65% 0.22% 99.06% 100.00% 515.02 93.94 365.32 790.45 $2508 for Japan
Ireland 99.87% 0.07% 99.72% 99.97% 1848.28 1383.89 606.17 4892.85
Switzerland puzzling
Israel 99.64% 0.19% 99.42% 100.00% 519.07 89.52 396.09 672.10
Italy 99.68% 0.02% 99.65% 99.74% 1645.53 755.50 839.13 3294.02
Japan 99.68% 0.04% 99.60% 99.76% 2508.77 1157.53 1252.48 5238.27
Average abatement cost
Korea 98.71% 0.34% 98.27% 99.20% 350.93 121.40 193.56 530.27
Luxembourg 99.74% 0.17% 99.31% 100.00% 3136.77 2624.05 741.89 8448.26
Mexico
Netherlands
99.08%
99.70%
0.16%
0.11%
98.73%
99.44%
99.32%
99.84%
96.6
565.63
23.40
141.81
68.56
338.04
148.61
795.47
per 1 ton of CO2 is 795
Zealand 99.59% 0.17% 99.34% 99.83% 331.65 114.37 173.08 486.27
USD,
Norway 99.97% 0.02% 99.92% 100.00% 1964.25 649.48 1365.45 3281.03
Poland 98.06% 0.83% 96.40% 99.07% 69.39 31.71 22.93 128.30 excluding Switzerland
Portugal 99.81% 0.09% 99.68% 100.00% 964.83 323.67 592.32 1472.48
Spain 99.65% 0.04% 99.60% 99.73% 1110.33 717.01 423.86 2590.70
Sweden 99.61% 0.31% 99.04% 100.00% 47.41 60.15 0.00 247.90 Switzerland is already p
Switzerland 99.96% 0.02% 99.93% 100.00% 18442 11706.42 7429.68 50260.96 roducing very efficiency,
hence high abatement
Turkey 99.66% 0.17% 99.20% 100.00% 19.31 15.81 0.00 70.52
UK 99.79% 0.19% 99.36% 100.00% 236.62 153.88 76.41 525.25
US 99.73% 0.24% 99.21% 100.00% 52.36 54.27 0.00 163.34 costs

17. CO2 ABATEMENT COSTS AND
POLLUTION TRADING PERMITS
 Pollution trading permits in the European area were
traded at the level of 30~40 EUR in 2006
 The market price went down to 8 EUR after the crisis
 Why is the market valuation of pollution trading permits
so low?
 Regulation on pollution is still in the making facing problems
with e.g. enforceability
 Market valuation may not take into account the multiplier
effects of a reduction in productive investment due to
efforts aimed at reducing the CO2 pollution

18. POTENTIAL COSTLESS REDUCTION OF CO2
Potential GDP Increase, million USD Potential CO2 Reduction, kilotons
Australia
Average
3992.11
SD
351.81
Min
3644.82
Max
4734.60
Average
2021.92
SD
369.72
Min
1660.39
Max
2815.15 A costless increase in GDP is
Austria
Belgium
582.80
1911.43
106.15
403.53
409.64
1329.28
731.11
2602.72
139.13
662.53
28.68
225.81
92.78
365.60
185.06
1087.33
possible for each country :
Canada
Chile
8313.32
1050.94
1704.61
432.41
6191.86
0.16
11486.95
2092.61
4117.57
399.80
1119.61
178.93
2689.81
0.06
6243.41
807.02
31 bn USD for US, 12.5 bn US
Denmark
Finland
375.24
1358.14
172.20
275.84
77.53
874.19
666.32
1814.44
117.24
545.91
67.38
187.79
20.73
265.01
293.71
925.12
D for Japan
France 9114.89 1251.51 7268.45 11847.28 1934.43 478.18 1318.52 3029.80
Germany 12431.24 2178.01 9385.40 16179.50 4087.84 1233.62 2601.84 6384.49
Greece
Hungary
810.74
1530.35
170.20
461.65
536.91
930.74
1308.16
2345.96
315.79
657.18
74.66
308.36
217.91
291.92
520.03
1263.06
CO2 levels can be costlessly
Iceland
Ireland
39.06
182.96
24.52
103.31
0.00
41.59
104.49
400.30
7.76
53.27
5.22
26.51
0.00
13.04
22.39
98.55
reduced by the same 0.5% on
Israel
Italy
509.58
5333.17
253.64
335.64
0.00
4665.95
942.87
6034.70
226.42
1468.18
119.07
146.46
0.00
1155.88
382.67
1711.13
average
Japan 12327.01 1324.53 9873.16 14882.34 3977.05 549.26 2893.74 4824.47
Korea 12286.62 1132.05 10501.37 13801.22 5770.14 1017.33 4145.44 7342.34
Luxembourg 85.64 62.73 0.07 223.06 24.63 16.10 0.03 60.28 Total amount of costless
Mexico 10645.06 1614.65 7828.40 14458.86 3834.91 688.95 2636.80 5473.75
Netherlands 1666.63 454.62 1067.70 2571.07 534.42 215.66 283.67 1003.53 reduction of CO2 levels in the
Zealand 394.89 139.83 198.95 705.57 133.19 54.75 57.19 234.96
Norway 74.30 52.91 0.45 188.77 14.64 10.92 0.08 39.40 OECD is only 1.5% of the 30%
reduction in Copenhagen
Poland 8934.24 2242.46 5810.18 12873.29 6585.74 3138.81 3274.95 12940.90
Portugal 386.89 202.95 0.00 699.13 118.77 64.52 0.00 218.34
protocol
Spain 3983.63 477.25 3133.44 4763.81 1114.35 137.33 902.68 1360.18
Sweden 1017.74 724.53 0.35 2236.95 213.81 180.23 0.05 585.83
Switzerland 117.74 52.37 0.57 201.56 18.40 8.45 0.07 29.61
Turkey 2136.85 1240.36 5.33 5408.57 792.69 460.77 1.83 2125.37
UK 3598.10 2799.94 11.99 9505.95 1175.10 1108.43 2.90 3725.28
US 27857.06 22403.67 94.65 71396.02 14616.68 13074.51 40.26 41801.44

19. TWO SCENARIOS OF CO2 REDUCTION
 30
 Scenario 1: allocate reduction targets ci such that: Min  i ci
 i 1
 Total goal of reducing CO2 by   0,1 is met s.t.
 No country sacrifices more than of its GDP   0,1
 30

 ci  c
 Total costs of reduction are minimized  i 1
i ci  GDP , i  1..30

i
Scenario 1 allocates as much as possible to the most ci  ci , i  1..30

efficient emission reducersincentive problem 
 Scenario 2: allocate reduction targets ci such that  30
 Min  i ci
:  i 1
 Total goal of reducing CO2 by   0,1 is met  s.t .
 17

 No country is reducing its CO2 levels by more  ci  c
than a fraction    of its current level ci  i 1
  

ci  ci , i  1..30
Scenario 2 is more fair compared to Scenario 1, but 

implementation costs may be high

20. ALLOCATING REDUCTION SHARES: SCENARIO 1,
UPPER CAP ON THE GDP OPPORTUNITY COSTS
CO2 Reduction, % 1. Increasing total reduction target increases the upper cap45%
30% 35% 40%
on Contribution, % Reduction, kt costs % Reduction, kt Contribution, % Reduction, kt Contribution, %
GDP opportunity Contribution,
Min GDP Reduction, % 1.19% 1.40% 1.62% 1.86%
CO2 Reduction Reduction, kt
Australia 15860 (4%) 0.41% 18658 (5%) 0.42% 21590 (6%) 0.42% 24789 (7%) 0.43%
Austria 1579 (2%) 0.04% 1858 (3%) 0.04% 2150 (3%) 0.04% 2469 (4%) 0.04%
Belgium
Canada
2. The GDP opportunity costs are rather modest at less
6276 (6%)
98801 (19%)
0.16%
2.58%
7384 (7%)
116236 (22%)
0.17%
2.60%
8544 (8%)
134502 (25%)
0.17%
2.63%
9810 (9%)
154428 (29%)
0.17%
2.69%
Chile
Denmark
than 2% even for a 45% total reduction
15052 (25%)
1412 (3%)
0.39%
0.04%
17708 (29%)
1661 (3%)
0.40%
0.04%
20490 (34%)
1922 (4%)
0.40%
0.04%
23526 (39%)
2206 (4%)
0.41%
0.04%
Finland 4903 (8%) 0.13% 5768 (10%) 0.13% 6674 (11%) 0.13% 7663 (13%) 0.13%
3. Individual reduction shares generally increase with
France 300187 (77%) 7.83% 353161 (91%) 7.90% 388751 (100%) 7.60% 388751 (100%) 6.76%
Germany 64727 (8%) 1.69% 76150 (9%) 1.70% 88116 (11%) 1.72% 101170 (12%) 1.76%
Greece
Hungary higher total reduction targets
3478 (4%)
8433 (14%)
0.09%
0.22%
4092 (4%)
9921 (17%)
0.09%
0.22%
4735 (5%)
11480 (19%)
0.09%
0.22%
5437 (6%)
13181 (22%)
0.09%
0.23%
Iceland 259 (12%) 0.01% 304 (14%) 0.01% 352 (16%) 0.01% 404 (18%) 0.01%
Ireland 916 (2%) 0.02% 1078 (3%) 0.02% 1247 (3%) 0.02% 1432 (3%) 0.02%
Israel
Italy
4. 30% reduction achievable at 362 bn USD
3419 (6%)
12206 (3%)
0.09%
0.32%
4022 (7%)
14361 (3%)
0.09%
0.32%
4654 (8%)
16617 (4%)
0.09%
0.33%
5343 (9%)
19079 (4%)
0.09%
0.33%
Japan 8502 (1%) 0.22% 21765 (2%) 0.49% 25186 (2%) 0.49% 10093 (1%) 0.18%
Korea 33537 (7%) 0.87% 39456 (9%) 0.88% 45656 (10%) 0.89% 52420 (12%) 0.91%
Luxembourg 5. Reduction burden distributed unequally: US accounting f
0 (0%) 0.00% 137 (1%) 0.00% 158 (2%) 0.00% 0 (0%) 0.00%
or more than14186 (8%) of total reduction
68%
Mexico 142918 (34%) 3.73% 168139 (41%) 3.76% 194561 (47%) 3.81% 223385 (54%) 3.88%
Netherlands 12058 (7%) 0.31% 0.32% 16415 (9%) 0.32% 18847 (11%) 0.33%
New Zealand 3602 (11%) 0.09% 4237 (13%) 0.09% 4903 (15%) 0.10% 5630 (17%) 0.10%
Norway 1280 (3%) 0.03% 1506 (4%) 0.03% 1743 (4%) 0.03% 2001 (5%) 0.03%
Poland 6. US, France, Turkey, Mexico, UK have to reduce >86% of t
83091 (25%) 2.17% 97754 (30%) 2.19% 113115 (34%) 2.21% 129873 (39%) 2.26%
Portugal
Spain
2503 (4%)
12133 (4%)
otal reduction (5%)
0.07%
0.32%
2945
14274 (5%)
0.07%
0.32%
3407 (6%)
16517 (5%)
0.07%
0.32%
3912 (6%)
18964 (6%)
0.07%
0.33%
Sweden 52484 (100%) 1.37% 52484 (100%) 1.17% 52484 (100%) 1.03% 52484 (100%) 0.91%
Switzerland 0 (0%) 0.00% 33 (0%) 0.00% 141 (0%) 0.00% 0 (0%) 0.00%
Turkey 7. Some countries required to reduce by 100%: Turkey, Swe
228128 (100%) 5.95% 228128 (100%) 5.10% 228128 (100%) 4.46% 228128 (100%) 3.97%
UK 94844 (17%) 2.47% 111582 (21%) 2.49% 129116 (24%) 2.53% 148244 (27%) 2.58%
US den, France: how realistic is this?
2621375 (47%) 68.37% 3083971 (55%) 68.95% 3568595 (64%) 69.81% 4097275 (73%) 71.25%
362.06 455.27 526.16 548.03
Total cost, bn USD
Note: ratio of allocated reduction to current CO2 emissions in parentheses

21. ALLOCATING REDUCTION SHARES:
SCENARIO 2, UPPER CAP ON THE INDIVIDUAL REDUCTION, 30% TOTAL GOAL
Max
Individual Reduction 50% 40% 30%
GDP GDP GDP
Reduction, Relative opportunity Reduction, Relative to opportunity Reduction, Relative to opportunity
kt to current costs kt current costs kt current costs
Australia 01. It is cheapest to allocate each country the maximum possible reduction in
0% 0.00% 0 0% 0.00% 107039 30% 8.03%
Austria 0 case the country is chosen to participate in reduction efforts
0% 0.00% 0 0% 0.00% 20205 30% 15.22%
Belgium 0 0% 0.00% 0 0% 0.00% 33661 30% 6.38%
Canada 265284 50% 3.20% 212227 40% 2.56% 159170 30% 1.92%
Chile 2. US, Mexico and Canada bear most of the reduction brunt in case the
30037 50% 2.37% 24030 40% 1.90% 18022 30% 1.42%
Denmark 0
individual plank is 50%
0% 0.00% 0 0% 0.00% 16061 30% 13.54%
Finland 0 0% 0.00% 24015 40% 5.83% 18011 30% 4.37%
France 194376 50% 0.77% 155500 40% 0.62% 116625 30% 0.46%
Germany 03. Fairness comes at a cost of unequal distribution of GDP opportunity costs:
0% 0.00% 332119 40% 6.11% 249089 30% 4.58%
Greece
Hungary
0
29754
Japan foregoes 25% of23803GDP in the plank3.36%
0%
50%
0.00%
4.20%
its
0 0%
40%
is 30%, 17852it does not reduce
0.00%
but
28443 30%
30%
9.73%
2.52%
Iceland 0 anything if individual reductions are capped by 40% 659
0% 0.00% 373 17% 1.72% 30% 3.03%
Ireland 0 0% 0.00% 0 0% 0.00% 12421 30% 16.13%
Israel
Italy
0
0
4. Individual reduction costs and GDP opportunity costs differ a lot
0%
0%
0.00%
0.00%
0
0
0%
0%
0.00%
0.00%
17814
138984
30%
30%
6.20%
13.55%
Japan 0 depending on the individual cap
0% 0.00% 0 0% 0.00% 390000 30% 25.09%
Korea 0 0% 0.00% 181509 40% 6.44% 136132 30% 4.83%
Luxembourg 0 0% 0.00% 0 0% 0.00% 2774 30% 28.39%
Mexico 5. It is cheapest to reduce CO2 by reducing the individual cap, but then only
207493 50% 1.73% 165994 40% 1.38% 124496 30% 1.04%
Netherlands 0 a few countries share the burden
0% 0.00% 0 0% 0.00% 52997 30% 5.23%
New Zealand 0 0% 0.00% 13106 40% 4.33% 9829 30% 3.25%
Norway 0 0% 0.00% 0 0% 0.00% 12164 30% 11.31%
Poland 6. The 30% uniform reduction is prohibitively expensive at 2.2 trillion USD
164725 50% 2.36% 131780 40% 1.89% 98835 30% 1.42%
Portugal 0 0% 0.00% 0 0% 0.00% 18443 30% 8.77%
Spain 0 0% 0.00% 0 0% 0.00% 94697 30% 9.29%
Sweden 26242 50% 0.44% 20994 40% 0.35% 15745 30% 0.26%
Switzerland 0 0% 0.00% 0 0% 0.00% 12409 30% 84.47%
Turkey 114064 50% 0.36% 91251 40% 0.28% 68438 30% 0.21%
UK 1990 0% 0.02% 217262 40% 2.73% 162947 30% 2.04%
US 2800000 50% 1.27% 2240000 40% 1.02% 1680000 30.00% 0.76%

22. CONCLUSIONS
 Basic tradeoff between uniformity of individual
reductions and GDP opportunity costs
 Uniform reductions at 30% “Copenhagen” levels are
prohibitively expensive relative to other scenarios
 Need additional criteria to choose individual reduction
planks or GDP opportunity costs
 Additional research needed to explore the dynamic
optimality of CO2 reductions