2011
DOI: 10.2139/ssrn.1367149
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The Impacts of the Climate Change Levy on Manufacturing: Evidence from Microdata

Abstract: We estimate the impacts of the Climate Change Levy (CCL) on manufacturing plants using panel data from the UK production census. Our identification strategy builds on the comparison of outcomes between plants subject to the CCL and plants that were granted an 80% discount on the levy after joining a Climate Change Agreement (CCA). Exploiting exogenous variation in eligibility for CCA participation, we find that the CCL had a strong negative impact on energy intensity and electricity use. We cannot reject the h… Show more

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Cited by 20 publications
(18 citation statements)
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“…Anger and Oberndorfer (2008) use a sample of German firms to assess the impact of the EU ETS on firm performance and employment. Martin et al (2009) analyze the effect of the energy tax and the climate change levy on firms in the UK manufacturing sector. Marklund (2010, 2012a) study the CO2 tax effect on profit technical efficiency directly, and through its impact on emissions, in Swedish manufacturing industries.…”
Section: Introductionmentioning
confidence: 99%
“…Anger and Oberndorfer (2008) use a sample of German firms to assess the impact of the EU ETS on firm performance and employment. Martin et al (2009) analyze the effect of the energy tax and the climate change levy on firms in the UK manufacturing sector. Marklund (2010, 2012a) study the CO2 tax effect on profit technical efficiency directly, and through its impact on emissions, in Swedish manufacturing industries.…”
Section: Introductionmentioning
confidence: 99%
“…As an example, the current 'leader' in climate change political debate and main responsible of the northern EU TP in the CKC, the UK, is experiencing a minor 0.5% cuts per year after having exploited the above mentioned benefits of the economy reshuffling towards 38 services and 'dash for gas' options. The partial failure, in terms of expected carbon cuts, of the UK climate change levy (associated to the CCA related 'agreements') may call for new stricter policies (Martin et al, 2009). France is thinking about a carbon tax on top of the noteworthy EU ETS scheme.…”
Section: Discussionmentioning
confidence: 99%
“…For example, Quirion and Hourcade (2004) show that an EU carbon tax in energy intensive sectors, without any recycling, would have lower impact on firms' marginal costs than inter-annual exchange rate variations. Econometric analysis from the UK, using a natural random experiment with a control and trial group of firms, show that the Climate Change Levy had a positive impact on energy intensity but fail to see any negative effect on firm performance (Martin et al 2011). In Section 3.3.2.1. below we discuss the potential positive competitiveness impacts of environmental regulation.…”
Section: Increasing Competitivenessmentioning
confidence: 99%