EU enlargement and environmental policy

Labor:

L = У γ £П_
Y ¹ ∂ PL

(A8)

Capital:

K = V γ .^∏L
Y ¹ ∂ PK

(A9)

Natural resources:

Q = γ Jf
^{f f} ∂ PR_f

(A10)

Domestic output:

_γ ^d ∏ Y = y Ad ∂∏i.
¹ ∂ P_i ^{y 1} ∂ P_i

(A11)

Energy aggregate:

E_i = Y₁ ɪ^-
^{1    1} ∂ PE₁

(A12)

Import aggregate:

M ₌ y Ad ^s ∏ A

¹   ,    s PM1

(A13)

Armington aggregate:     AY =

_:y Y ^H^γ- + INV
^δ↑ ^j ∂ PAY      ∂ Pa^nv

AC - C ^CT
∂ PAC

Af - Z ^^ZΓ

¹     ∂ PAf

(A14)

Private demand:   PC ■ C = PL

■ L + PK ■ K + У PQ_f ■ Q_f - PINV ■ ~NV - PC ■ Br
f

(A15)

Government consumption: PZ ■

Z = p^co 2 ■ co2 + other taxes

(A16)

Government output:

Z = Z

(A17)

Investment:

~NV = INV

(A18)

Carbon emission constraint:

CO2 = yy AfaCf²

(A19)