WP5 – Economy-wide and distributional effects
The effectiveness of Swedish measures and their effects on competitiveness, and ultimately welfare, depends on strategies chosen elsewhere and will, thus, influence Sweden’s ability to be an early mover in decarbonization. The aim of WP5 is to shed empirical light on these issues, using the Comprehensive General Equilibrium (CGE) modeling approach and unique empirical data, a combination that makes this work novel and unique.
Through the iterative WP work managed by WP1, WP5 will inform WPs 3 and 4 on the overall distributional effects of the different transition pathways. As outlined in the description of WP1, this WP aims at incorporating stakeholder information knowledge to sharpen the analysis and place it in a realistic framework. The work in WP5 is novel in that we will contribute new theoretical results on the links between competitiveness metrics and exact welfare measures in a general equilibrium setting. This should be of great importance since, as mentioned in the introduction, the views in the public and political debates on the effect of the energy transition on the economy vary widely.
Objectives of WP5
- To quantify the effects on competitiveness of the energy transition pathways obtained from WP2–WP4, i.e., under different technology mixes and policy assumption in Sweden and internationally (cf. Figure 1).
- To quantify the distributional effects of the energy transition pathways obtained from WP2–WP4, i.e., under different technology mixes and policy assumptions.
- To understand the role of electricity trade with neighboring countries in the transition pathways, using inputs from WP1 and iteratively with WP2.
The results from the analysis will be iterated with WPs 2–4.