Linking Top-Down and Bottom-Up Models for Climate Policy Analysis : The Case of China
Top-down economic models, such as computable general equilibrium models, are the common tools to assess the economic impacts of climate change policies. However, these models are incapable of representing the detailed technological characteristics...
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| Language: | English |
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World Bank, Washington, DC
2019
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/426801561032910616/Linking-Top-Down-and-Bottom-UP-Models-for-Climate-Policy-Analysis-The-Case-of-China http://hdl.handle.net/10986/31924 |
| Summary: | Top-down economic models, such as
computable general equilibrium models, are the common tools
to assess the economic impacts of climate change policies.
However, these models are incapable of representing the
detailed technological characteristics of the sources of
greenhouse gas emissions. The economic impacts measured by
the top-down economic models are likely to be overestimated.
This study attempts to quantify the overestimation by
measuring the economic impacts linking the top-down model
with a bottom-up engineering model for the energy sector.
The study uses meeting China's pledges under the Paris
Agreement for testing this hypothesis. The study shows that
the economic impacts measured by the stand-alone top-down
model are almost three times as high as those resulting from
the model after linking it with the bottom-up model.
However, the findings are sensitive to the assumptions and
existing or planned policies on energy technologies
considered in the bottom-up model. |
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