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Decarbonizing economies through carbon pricing - is there an ideal policy mix? - evidence from South Africa: the impact of fdis on emissions and a step forward to carbon neutrality
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Explicit and implicit carbon pricing are indispensable to reduce emissions and direct economies towards carbon neutrality. This report aimed to investigate whether there is a policy mix that is the most effective in emission reduction. A cluster analysisbased on countries’ environmental policy mixesshowed that stringent market-based instruments such as the CO2 tax are substantial for effective emission abatement. In a second step, an emissions forecasting model was developed to see the variables that most influence emissions within each cluster, with the aim of making targeted recommendations to individual countries. This model was applied to South Africa, with a special focus on the effect of FDI on emissions. It was seen how this effect depends on the level of development of the receiving country and the quantity and quality of FDI.
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Climate change Decarbonization Carbon pricing