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dc.titleExpectations of Economy and Finance Ministries on Carbon Pricing and Evidence of their Effectiveness
dc.contributor.authorTalbot-Wright, Hipólito
dc.contributor.authorDelgado, Raúl
dc.contributor.authorVogt-Schilb, Adrien
dc.contributor.authorAlvarado, Jose Miguel
dc.contributor.authorBuchuk, Daniela
dc.contributor.authorTorres Pelaez, Daniela
dc.contributor.authorLoo-Kung, Rudy
dc.contributor.orgunitClimate Change Solutions Division
dc.contributor.orgunitFiscal Management Division
dc.coverageLatin America and the Caribbean
dc.date.available2024-03-12T00:03:00
dc.date.issue2024-03-12T00:03:00
dc.description.abstractThis document analyzes the expectations and objectives of the Ministries of Finance, Economy, and Finance of Latin America and the Caribbean regarding implementing carbon pricing mechanisms. It contrasts it with existing evidence regarding these instruments. Twelve qualitative interviews were conducted with specialists from ministries in the region, revealing that countries mainly adopted these instruments to support climate policy. To do so, ministries seek, in some cases, for these instruments to incentivize emissions reduction or, in other cases, to meet fiscal and investment mobilization goals for climate action. While countries have positive expectations about their effectiveness in reducing emissions, they still need to evaluate their performance. The analysis of existing evidence concludes that carbon pricing implemented to date has had modest effects on emissions, with multiple barriers preventing them from reaching their theoretical potential. However, if these instruments are well-designed, they can be complementary tools to support decarbonization efforts, as they cannot catalyze the necessary structural transformations independently. Therefore, the recommendation is to include them in a broader set of climate policies, mitigate their distributive effects, evaluate their outcomes, and strengthen the technical capacities of ministries.
dc.format.extent42
dc.identifier.doihttp://dx.doi.org/10.18235/0012852
dc.identifier.urlhttps://publications.iadb.org/publications/english/document/Expectations-of-Economy-and-Finance-Ministries-on-Carbon-Pricing-and-Evidence-of-their-Effectiveness.pdf
dc.identifier.urlhttps://publications.iadb.org/publications/spanish/document/Expectativas-de-los-ministerios-de-Hacienda-Economia-y-Finanzas-sobre-los-precios-al-carbono-y-evidencia-de-su-efectividad.pdf
dc.language.isoen
dc.publisherInter-American Development Bank
dc.relation.seriesMEF Climate Change Platform
dc.subjectFiscal Policy
dc.subjectMinistries
dc.subjectTaxation
dc.subjectCarbon Tax
dc.subjectFinance
dc.subjectEnvironmental Economy
dc.subjectCredit Market
dc.subjectClimate Change Mitigation
dc.subjectPollution Prevention
dc.subjectEconomy
dc.subjectDecarbonization
dc.subjectLow-Carbon Economy
dc.subjectFiscal Management
dc.subjectGreenhouse Gas Emission
dc.subjectCarbon Offsetting
dc.subjectFiscal Institution
dc.subjectClimate Finance
dc.subjectCarbon Finance
dc.subjectMEF Climate Change Platform
dc.subject.jelcodeQ54 - Climate • Natural Disasters and Their Management • Global Warming
dc.subject.jelcodeQ58 - Government Policy
dc.subject.jelcodeH23 - Externalities • Redistributive Effects • Environmental Taxes and Subsidies
dc.subject.keywordsFiscal policy;Environmental economics;mitigation;decarbonization;economic instruments;carbonpricing;carbon markets;carbon tax;carbon offsets;Climate Finance;net zero emissions
dc.typeMonographs
idb.identifier.pubnumberIDB-MG-01163
idb.operationRG-E1907
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