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Low-carbon, human development economy-wide modelling

Low-carbon, human development economy-wide modelling. Marco Sanchez / Eduardo Zepeda UN-DESA. Successful and on-going capacity development projects LAC. Bolivia (UDAPE- Planning ) Remittances Food price volatility MDGs to 2015, 2020 and 2025 Costa Rica

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Low-carbon, human development economy-wide modelling

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  1. Low-carbon, human development economy-wide modelling Marco Sanchez / Eduardo Zepeda UN-DESA

  2. Successful and on-going capacity development projects LAC • Bolivia (UDAPE-Planning) • Remittances • Foodpricevolatility • MDGsto 2015, 2020 and 2025 • Costa Rica • MDG education (on time completion (Education) • Macro-economicimpact of governmentdebt in internationalmarkets and alternative use of resources (Finance & Parliament) • Impact of incometax rebates (University and Parliament) • Uganda • SupporttotheNationalDevelopment Plan (Planning) • Supportto MDG report (Finance and Planning, UNDP) • Supporttoassesstheimpact of thefall in foreignaid (Planning)

  3. Low-carbon & human development (or inclusion) • Global model estimates of additional energy investments needed to stabilize temperature range from negative to levels up to 8 % of GDP • Investments are larger in Africa and Asia • Own MDG estimates suggest that pursuing MDG achievement of 3 goals might cause annual losses in GDP of up to 2 % of GDP. • Estimates suggest the presence of important synergies

  4. A comprehensive modeling framework • Policy making needs to be comprehensive • Take into account macro-economic impacts and fiscal space • Energy transformation (decarbonizing and low-carbon building) • Human development, as proxy by MDGs • Energy poverty • Trade-offs and synergies

  5. Examples of simulations • Three oil-importing countries where team are working on economy-wide modelling Bolivia, Costa Rica and Uganda • Impose a tax on oil to generate a revenue equal to 2% of GDP • Revenue is used to finance infrastructure and education, which raises productivity • Tax on oil decreases

  6. Raw example of possible simulations • Tax on oil decreases GDP growth rate by up to 2 percentage points • The effect of investing added revenues varies across countries and the type of investment • Using the tax revenue tends to neutralize and even more than offset the negative effect of the oil tax

  7. Impact on GDP growth of a tax oil and investment in education, percentage points from baseline GDP

  8. The effect on education achievement in Uganda is noticeable, not in Bolivia

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