The Effect of a Carbon Tax on the Economy, Welfare and Emissions in Morocco: A Computable General Equilibrium Approach

In this paper, we are interested in the issue of using a carbon tax as a policy to address the increasing CO2 emissions in the case of Morocco. To do so, we used a computable general equilibrium model of the PEP (1-1) type with 2018 data, and we simulated two scenarios, the first with a tax of 50 MAD/ton of CO2 and the second with a tax of 75 MAD/ton of CO2. The second scenario yields a larger decrease in carbon emissionsthan the first; however the decreases in GDP and welfare are significantly larger.Overall, both rates are effective, and it remains for policy makers to choose the best scenario according to their priorities.