Environmental indicators, modelling and outlooks

Environment-economy modelling: employment and distributional issues


The costs of environmental policies may significantly differ across households and types of workers. These policies can also provide opportunities to reduce poverty and inequalities if combined with appropriate redistribution of the revenues they raise. In order to investigate the impact of environmental policies on poverty and inequalities, the ENV-Linkages model, which in its core specification relies on a single regional representative household, is extended to include further details on skills, employment or households.




  • The jobs potential of a transition towards a resource efficient and circular economy examines the consequences of a policy-driven transition towards a more resource-efficient and circular economy on employment levels across countries and sectors during the period 2018-2040. The analysis relies on simulations with ENV-Linkages, the global structural computable general equilibrium model of the OECD Environment Directorate. The results suggest that the overall reallocation of jobs due to a fiscal policy package promoting resource efficiency and the transition to a circular economy is limited to 18 million jobs in 2040 and net job creations are marginal, with 1.8 million of jobs.
  • Labour Market Consequences of a Transition to a Circular Economy provides an overview of the modelling literature on the labour market consequences of a transition to a circular economy.
  • Impacts of Green Growth Policies on Labour Markets and Wage Income Distribution: A General Equilibrium Application explores the consequences on the labour markets of structural changes induced by decarbonisation policies. These policies are likely going to have consequences on labour-income distribution given i) existing rigidities in the labour markets, and ii) their different impacts on sectors and on job categories. 
  • Employment Impacts of Climate Change Mitigation Policies in OECD: A General-Equilibrium Perspective provides an analysis of how the implementation of a green growth agenda may translate into deep changes in the labour market that extend far beyond the creation of what are often labelled as “green jobs”. While there are a number of opportunities associated with green growth, there are also costs associated with the transition.
  • Modelling of distribution impacts of energy subsidy reforms: An illustration with Indonesia provides, in the case of Indonesia, an assessment of the economic, environmental and distributional impacts of fossil fuels consumption subsidy reforms. The study is based on the context that pertained until mid-2014, when international oil prices where high and before the recent phase out of Gasoline and Diesel subsidies by the Indonesian authorities. This work is based on a version of ENV-Linkages that includes over 10 000 Indonesian household groups.






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