Efficiency of a Biofuel Subsidy Policy in the Presence of Environmental Externalities

The object of this paper is to analyze, in a general equilibrium setting with four markets, the efficiency of a biofuel subsidy policy. The analysis takes into account environmental externalities associated both with the production and the consumption of biofuels, as well as associated with the production of agricultural raw material. Our preliminary numerical results, applied to the biodiesel subsidy policy in France, first show that this policy increases the utility of the representative consumer compared to the laissez-faire solution. The same policy action leads, however, to an increased level of agricultural and GHG emissions, in comparison with the laissez-faire solution.


Issue Date:
2008
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/44399
Total Pages:
16




 Record created 2017-04-01, last modified 2017-04-26

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