Conference Agenda

International economic integration is increasingly characterized by multinational production (MP). The environmental implications of this shift are unclear as different forms of multinational activity affect emissions in different ways, both for production and transportation. MP may reduce pollution by transferring cleaner technology abroad or exacerbate it by outsourcing dirtier production to foreign countries with pollution-intensive technologies. In terms of transportation emissions, MP may substitute trade, reducing the emissions from shipping, or enhance trade and accelerate pollution from transportation. We provide a quantitative general equilibrium framework that brings together MP, international trade, and carbon emissions from production and transportation. As the available data on MP and emission does not fully identify multinational activity and emissions, we consider the range of calibrated models compatible with the data and accordingly report result intervals for all counterfactual scenarios considered. Comparing the current emissions with counterfactual emissions in autarky, we show that under a mild restriction on the initial emission allocation, MP and trade jointly have almost no potential to lower global carbon emissions.

This paper presents a method for estimating treatment effects of local cost shocks when regions trade with each other. Because of spillovers induced by trade flows, comparing the evolution of outcomes between pre-shock and post-shock periods in regions exposed versus unexposed to local shocks leads to a biased estimate of treatment effect. We model these across-region dependencies using standard assumptions from international trade theory. We use our model-consistent estimation strategy to revisit the literature on the evaluation of impacts from climate change onto country-level gross output using year-to-year variation in temperature and precipitation.

According to the International Energy Agency (IEA), reaching Net-Zero emissions target by 2050 requires a deep penetration of hydrogen, and is expected to represent 12% of global final energy consumption. However, this deployment faces constraints on both supply and demand scale up, and matching. In this paper, we ask if global hydrogen trade liberalization enables the optimal hydrogen production capacities deployment in a carbon-neutral energy system by 2050. Combining an energy system least-cost optimization model (KiNESYS-IFPEN) with an adapted logistic diffusion model with uncertainty on parameters, we find that, while regionally impactful, global hydrogen trade openness has limited effects globally. The distribution effect across regions dominates since several specialize themselves as exporters (Middle East, Latin America, Australia and Africa), or as importers (Europe and East Asia). This effect is stronger when combined with investment costs reduction in electrolysers and longer expectations on future hydrogen market size.

These results highlight the trade-off between achieving least-cost regional energy transition and ensuring hydrogen supply security.

How does regional economic activity shape regional climate impacts? Land use and land cover (LULC) change with economic activity, affecting regional climate through biophysical channels like albedo. These regional feedbacks are often overlooked in quantitative spatial models, which focus on global carbon effects. By incorporating this biophysical feedback, I find notable welfare implications for adaptation and mitigation, as it alters temperature impacts and interacts with regional adaptation. Using a dynamic-spatial model at a global 1° grid along ‘middle-of-the-road’ scenario SSP2-4.5, I estimate the welfare consequences of climate change, with agents that adapt through migration, structural change and trade. I interact intra-annual climate projections with model-consistent non-linear damage patterns on amenities and sectoral productivities. Without biophysical impacts, almost all locations experience negative welfare changes: there are no benefits to be expected from climate change in the Northern Hemisphere. Biophysical channels account for 2.4% of total welfare impacts, intensifying regressive effects of climate change on lower-income regions.