Global assessments of GHG abatement options and associated costs, and especially their distribution across world regions, between energy exporter and energy importer countries, between different MDC and LDC groups are important for negotiators working on the next round of international agreements. They provide insights into the relative merits of various global policy instruments, possible schemes to share the costs and to compensate for losses, leakages resulting from the migration of carbon-intensive activ- ities to non-participating free riders and the like. Though valuable, this information is only a small part of what negotiators at international fora and policymakers responsible for national policy formulation need to know.
The willingness of each state t o participate in more or less ambitious international GHG agreements and the stringency of domestic policies will be determined by the costs individual countries need to pay for it and ul- timately what national governments can get their voters and influential in- terest groups to accept. Large number of earlier studies concluded that, for a given national commitment to a specific international agreement, national costs of compliance can be significantly reduced by carefully choosing the appropriate primary policy instrument and a set of offsetting mechanisms.
These types of national studies are of special importance for countries who are major players in the international GHG arena either because of their high current contributions t o global emissions or because of their large reserves of fossil fuels, mainly inexpensively extractable coal.
The latest vintage of the Jorgenson-Wilcoxen model (this volume) is a useful example of this kind of analysis. By estimating parameters of a highly disaggregated (I would call it "top-to-deep-down") general equilibrium model econometrically from long historical data sets, the authors give their model a respectable memory of long-term evolution processes. This makes all model parameters and especially elasticities more suitable for long-term future anal- yses than single-point parameterization. Although the perfect substitution assumption used in the model does not permit modeling the depletion of fossil fuel sources, this is not an important limitation as proven geological stocks will not be depleted over the model's time horizon of roughly one century. This powerful tool is then used to evaluate macroeconomic costs of different GHG policy instruments for the US economy.
The model and the results presented by Hourcade (this volume) for France are in a sharp contrast with the Jorgenson-Wilcoxen study. Com- pared to the US and, in fact, to most other countries in the OECD group, France is a low C 0 2 intensive country due to its ambitious nuclear energy program. This characteristic would suggest that further reductions in C 0 2 emissions would be difficult, and it even raises the danger of massive future increases. In contrast t o the US approach, the French model falls in the cat- egory of engineering-type bottom-up models. By analyzing the phenomenon of technological bifurcations, the paper reveals a new way of looking a t long- term implications of near-term technological decisions involving very similar set-up or short-term costs and presents a n interesting perspective t o think about endogenous technologies.
Japan has traditionally been very sensitive to any threat t o its high rate of economic growth. Its reliance on imported sources of energy makes the issue of climate change even more important. It is therefore not surprising that several studies have been conducted in Japan t o assess the options and costs of COz emission reductions. Amano (this volume) presents a comparative analysis of these studies covering a broad range of multi-sectoral dynamic optimization models and different types of econometric models of the Japanese economy, and series of global models as well.
One of the major sources of uncertainty in all global models is the pace and character of economic development in general, and the evolution of the energy sector in particular over the next two t o three decades in countries of Eastern Europe and the former Soviet Union, dubbed as the EEFSU region in most recent global models. In 1986, probably the "last year of peace" before economic decline became evident in most EEFSU countries, their contribution t o the global COz emissions was more than impressive.
It was 26 percent compared to their population share of 8 percent, and a share in global G D P of about 6 percent.2 On the "Top 20" list of countries ranked according t o their relative (percentage) contribution to global C 0 2 emissions, the USSR ranked 2nd, Poland 8th, the GDR 13th, Czechoslovakia 15th, and Rumania 17th. In terms of per capita emissions, which is probably better a t characterizing their distorted economic structures and wasteful use of energy, the GDR was a sovereign leader leaving the US behind by a fair margin, Czechoslovakia ranked 3rd ahead of Canada, the USSR 6th, right
'It is notoriously difficult to prepare comparable GDP estimates for the formal centrally-planned economies. A casual review (Begg et al., 1990) reveals differences on the order of 5 t o 7 times between various calculations. The numbers here are based on some middle-ground estimates and the author's calculations.
behind Australia, and Poland 7th ahead of the then smaller FRG. Rank 10 for Rumania in front of Japan is also worth mentioning.
With a view t o the importance of the region in past C 0 2 emissions and its potential contribution to future emission reductions at the global level, the two contributions from Russia included in this volume are of special in- terest. First, much of the in-depth data about the FUSSR energy systems have only recently become available t o the international expert community.
Second, analysis and evaluation of these systems by those who have the most experience with them are most relevant in the phase of economic transfor- mation. Bashmakov (this volume) approaches the COz mitigation problem by taking an inventory of the relative costs and benefits of energy efficiency improvement options in different sectors of the national economy. Kononov (this volume) presents three scenarios of the transition period up t o 2010 his analysis is that it follows through a wide range of detailed technological options under several macroeconomic development scenarios.
Most studies about global GHG mitigation declare explicitly or assume implicitly that developing countries cannot be expected to undertake costly measures in the short t o medium term t o reduce their C 0 2 emissions. Yet, several studies are underway t o estimate costs and benefits of C 0 2 abatement options in the LDC region. Pachauri and Khanna (this volume) point out t o the special constraints to be considered when analyzing costs of mitigation options in developing countries. In addition, they present cost curves of COz abatement for several Asian countries and for Brazil. Moreira (this volume) discusses a series of economic, institutional, and technological policy options to enhance C 0 2 mitigation in Brazil. Biomass-related options, that is slowing deforestation and large-scale afforestation, occupy a prominent place on his list of GHG policies.
Papers in Section 4 reflect the large variance in estimates of G H G / C 0 2 mitigation costs produced by national and regional studies t o date. The large variety of modeling approaches, the broad range of initial assumptions, and major differences in the principles and techniques of cost accounting has produced such a rich diversity of results that is simply bewildering t o
policymakers. In order to make these results comparable across countries and regions, some generally agreed standards are needed for national cost studies. Halsnaes and Mackenzie (this volume) report results from a study conducted on the methodological aspects of abatement cost calculations.
The debate among economists about global warming, its impacts and damages, the feasibility and costs of its mitigation, and the diversity of policy recommendations from the economics community is a relatively small part of the overall climate change debate. The summaries prepared from time t o time (Houghton and Woodwell 1989, Schneider 1989a, 1989b; White 1990) report progress on individual topics or single components of the problem in atmospheric sciences, but they do not seem to push the overall debate sub- stantially further. Ausubel (this volume) considers a selected set of issues in the general global warming debate and relates them to recent developments in their economic counterpart or equivalent. By relating recent estimates of global warming costs and benefits to a frightening list of other environmental problems which need attention and funding, he creates especially instructive examples about the real size of financial assets that look so negligible in terms of national or world GDP percentages.