Modeling the Incentive Effect of Carbon Tax Policy on the Transformation of High Carbon-Emission Enterprises

Encouraging high carbon-emission enterprises to transform to low carbon-eimission enterprises by levying carbon tax is an important way for China to develop low-carbon economy.Through the construction of principal-agent model between the government and the high carbon enterprises and the analysis of the incentive contract made by the government to impose carbon tax in order to cut down the CO2discharge from the high carbon enterprises,this paper concludes that the carbon tax rate designed by government can put the gross CO2emission in the high carbon industry under control and add their intrinsic motivation to decrease the CO2discharge and also inspire them to make transformation.This paper makes on empirical study and gets the optimal carbon tax rates of reducing the CO2 emissions from this industry.