GTAP Resources: Resource Display
| GTAP Resource #7748 |
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"Economic and Environmental Trade-offs of Sustainable Fuel Policies in Brazil" Authors: Domingues, Edson, Guilherme Perobelli, Gustavo Luz and Aline Magalhaes Abstract This article evaluates the economic and environmental impacts of Brazil’s Fuel of the Future Law using a recursive-dynamic Computable General Equilibrium (CGE) model calibrated to Brazil’s 2015 System of National Accounts. The law mandates a progressive increase in biofuel blending rates — raising the ethanol share in gasoline from 27% to 35% and the biodiesel share in diesel to 20% by 2030 — and is simulated against a business-as-usual baseline over 2025–2030. Results indicate moderate but consistent macroeconomic costs: GDP falls by -0.3%, investment by -0.8%, household consumption by -0.4%, and employment by -0.1% relative to the baseline, driven by fuel price increases of 9.0% for blended gasoline and 5.3% for blended diesel. On the environmental side, the policy delivers a -1.7% reduction in greenhouse gas emissions and a -1.4% decline in the emissions-to-GDP ratio, but generates significant indirect land-use change, with cropland expanding by 2.1 million hectares — including approximately 463 thousand hectares of native forest loss. The findings underscore a fundamental trade-off: meaningful environmental gains come at the cost of reduced economic activity, higher fuel and food prices, and substantial pressures on native land cover. |
| Resource Details () | GTAP Keywords | ||||||||||||||||
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- Climate change policy - Environmental policies - Land use - Domestic policy analysis - Transportation - Dynamic modeling - South America |
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If you have trouble accessing any of the attachments below due to disability, please contact the authors listed above.
Public Access  GTAP Resource 7748 (382.2 KB) Replicated: 0 time(s)Restricted Access No documents have been attached. Special Instructions No instructions have been specified. |
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Last Modified: 4/30/2026 12:56:16 PM
