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OECD Releases Paper on Climate Policies and Competitiveness

November 2010: The Organisation for Economic Co-operation and Development (OECD), together with the International Energy Agency (IEA), has released a report titled “Addressing International Competitiveness in a World of Non-uniform Carbon Pricing: Lessons from a Decade of OECD Analysis.”

The report is part of a series of documents summarizing the OECD's climate change related work, and making recommendations to the Cancun Climate Change Conference. This paper discusses results of a decade of OECD and IEA research on competitiveness impacts of national and regional climate change policies on national economies.

Among its main findings are that: adverse effects are limited to a small number of economically small sectors; targeted and time-bound policies aimed at specific areas are one good way of beginning a transition to a low-carbon economy; and free allowance allocations, border-tax adjustments and industry exemptions have been commonly used to ease this transition in the past. It concludes by noting that, no matter which path is chosen, all policies must be scrutinized for appropriateness to the given political economy in question, as well as for economic efficiency. [The Paper]