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Border Adjustments for Economywide Policies That Impose a Price on Greenhouse Gas Emissionsreport
A carbon tax or cap-and-trade program could make emission-intensive U.S. products less competitive and increase emissions overseas. Import tariffs related to emissions could reduce those effects but would be hard to implement.      International Trade and Carbon Leakage: Working Paper 2013-08working paper
Under a broad-based carbon tax or cap-and-trade program, some of the reduction in U.S. emissions would probably be offset by increases in foreign emissions, a phenomenon known as carbon leakage. |
