Challenges in the Measurement of Leakage Risk

摘要

With the launch of China's emissions trading scheme in 2018, more than a quarter of global greenhouse gas (GHG) emissions will be subject to some form of carbon pricing (Zechter et al. 2017). This is an important milestone, but one that still leaves the majority of global GHG emissions unpriced.The global nature of climate change creates challenges for a policy regime that covers only a subset of the sources contributing to the problem. If these incomplete policies induce a real-location of economic activity from regulated to unregulated jurisdictions, the associated "leakage" of GHG emissions can offset emissions reductions and undermine cost effectiveness. Thus, concerns about emissions leakage loom large in debates about regional climate change policy.Correctly identifying the kinds of economic activities most at risk of carbon leakage is a critical first step in the design of effective risk mitigation. In this short paper, a simple formulation of emissions leakage provides a conceptual framework for leakage risk assessment in theory and practice. We briefly summarize current approaches to assessing leakage risk and highlight a sizable gap between academicresearch and real-world policy implementation. An emerging research agenda that aims to close this gap is discussed.