TradeinLowCarbonTechnologies:TheRoleofClimateandTradePoliciesSamuelPienknaguraWP/24/75IMFWorkingPapersdescriberesearchinprogressbytheauthor(s)andarepublishedtoelicitcommentsandtoencouragedebate.TheviewsexpressedinIMFWorkingPapersarethoseoftheauthor(s)anddonotnecessarilyrepresenttheviewsoftheIMF,itsExecutiveBoard,orIMFmanagement.2024MAR©2024InternationalMonetaryFundWP/24/75IMFWorkingPaperResearchDepartmentTradeinLowCarbonTechnologies:TheRoleofClimateandTradePoliciesPreparedbySamuelPienknagura*AuthorizedfordistributionbyFlorenceJaumotteMarch2024IMFWorkingPapersdescriberesearchinprogressbytheauthor(s)andarepublishedtoelicitcommentsandtoencouragedebate.TheviewsexpressedinIMFWorkingPapersarethoseoftheauthor(s)anddonotnecessarilyrepresenttheviewsoftheIMF,itsExecutiveBoard,orIMFmanagement.ABSTRACT:CurbingcarbonemissionstomeetthetargetssetintheParisAgreementrequiresthedeploymentoflowcarbontechnologies(LCTs)ataglobalscale.ThispaperassessestheroleofclimateandtradepoliciesinfosteringLCTdiffusionthroughtrade.Leveragingacomprehensivedatabaseofclimatepoliciesandanewdatabaseidentifyingtradeinlowcarbontechnologiesandthetariffsappliedtothesegoods,thispapershowsthattheintroductionofnewclimatepolicieshasapositiveandsignificantimpactonLCTimports.Zoomingintospecificclimatepolicies,thepaperfindsthat,exceptfornon-bindingones,allclimatepoliciesstimulateLCTimports.ThepaperalsohighlightstheroleoftradepoliciesasanengineofLCTdiffusion—reductionsintariffsappliedonLCTgoodshaveasizeableimpactonLCTimports.Ontheflipside,resultssuggestthatmoreprotectionistmeasureswouldimpedethespreadoflow-carbontechnologies.RECOMMENDEDCITATION:“TradeinLowCarbonTechnologies:TheRoleofClimateandTradePolicies,”bySamuelPienknagura,IMFworkingpaper,2024.JELClassificationNumbers:F14,F18,Q55,Q58Keywords:Climatepolicies;trade;lowcarbontechnologies;technologicaldiffusion.Author’sE-MailAddress:spienknagura@imf.orgIMFWORKINGPAPERSInflatedConcerns:ExposuretoPastInflationaryEpisodesandPreferencesforPriceStabilityINTERNATIONALMONETARYFUND3WORKINGPAPERSTradeinLowCarbonTechnologies:TheRoleofClimateandTradePoliciesPreparedbySamuelPienknagura11IthankHasanDudu,ZeinaHasna,AndrewHodge,FlorenceJaumotte,AmitKara,GeoffreyKeim,KoralaiKirabaeva,GregorSchwerhoff,andNateVernonforcommentsandsuggestions.TheviewsexpressedinthepaperarethoseoftheauthorsanddonotnecessarilyrepresenttheviewsoftheIMF,itsExecutiveBoard,orIMFmanagement.TradeinLowCarbonTechnologies:TheRoleofClimateandTradePolicies∗SamuelPienknagura†April2024AbstractCurbingcarbonemissionstomeetthetargetssetintheParisAgreementrequiresthedeploymentoflowcarbontechnologies(LCTs)ataglobalscale.Thispaperas-sessestheroleofclimateandtradepoliciesinfosteringLCTdiffusionthroughtrade.Leveragingacomprehensivedatabaseofclimatepoliciesandanewdatabaseidentifyingtradeinlowcarbontechnologiesandthetariffsappliedtothesegoods,thispapershowsthattheintroductionofnewclimatepolicieshasapositiveandsignificantimpactonLCTimports.Zoomingintospecificclimatepolicies,thepaperfindsthat,exceptfornon-bindingones,allclimatepoliciesstimulateLCTimports.ThepaperalsohighlightstheroleoftradepoliciesasanengineofLCTdiffusion—reductionsintariffsappliedonLCTgoodshaveasizeableimpactonLCTimports.Ontheflipside,resultssuggestthatmoreprotectionistmeasureswouldimpedethespreadoflow-carbontechnologies.Keywords:Climatepolicies,trade,lowcar...