ANALYZING THE COST OF AN OECD ENVIRONMENTAL TAX TO THE DEVELOPING-COUNTRIES

Most studies on the global warming issue neglect the impact of proposed measures (eg carbon tax) on the economies of the developing countries in their anlayses. In this paper, an attempt has been made to bridge this gap. By using a standard econometric model, the major (possible) impacts of an OECD carbon tax on developing countries under different policy options were examined. Implementing a carbon tax policy could set serious restrictions to the developmental efforts of the developing countries. The role of non-commercial energy-use vis-a-vis global warming was also investigated. The need for a global perspective when designing effective environmental policies is inevitable.