New Findings from Bank of Canada Describe Advances in Economics (Impacts of Border Carbon Adjustments On the Canadian Economy): Economics

2025 JAN 03 (NewsRx) -- By a News Reporter-Staff News Editor at Economics Daily Report -- New research on Economics is the subject of a report. According to news reporting out of Ottawa, Canada, by NewsRx editors, research stated, “This paper examines how border carbon adjustments (BCAs) may address the consequences of uncoordinated global climate action, focusing on the economic impacts for Canada. We investigate these impacts under different BCA design features and by considering a coalition of countries and regions that adopt BCAs.”

Our news journalists obtained a quote from the research from the Bank of Canada, “We find that when Canada is within a coalition of BCA-implementing countries including the United States, BCA measures in the form of import tariffs reduce Canada’s carbon leakage and boost domestic and foreign competitiveness. We show that these results may change if Canada imposes BCAs on a different set of sectors than the rest of the coalition or includes export rebates and free emissions allowances to firms.”

According to the news editors, the research concluded: “When Canada remains in the coalition while the United States does not, we show that Canada’s carbon leakage increases, domestic competitiveness weakens, and foreign competitiveness improves.”

This research has been peer-reviewed.

For more information on this research see: Impacts of Border Carbon Adjustments On the Canadian Economy. Energy Economics, 2025;141. Energy Economics can be contacted at: Elsevier, Radarweg 29, 1043 Nx Amsterdam, Netherlands. (Elsevier - www.elsevier.com; Energy Economics - http://www.journals.elsevier.com/energy-economics/)

Our news journalists report that additional information may be obtained by contacting Hossein Jebeli, Bank of Canada, 234 Wellington St W, Ottawa, On K1A 0G9, Canada. Additional authors for this research include Craig Johnston, Marie-Christine Tremblay, Y. -H. Henry Chen and Sergey Paltsev.

The direct object identifier (DOI) for that additional information is: https://doi.org/10.1016/j.eneco.2024.108089. This DOI is a link to an online electronic document that is either free or for purchase, and can be your direct source for a journal article and its citation.

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