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GTAP Resource #7838

"Decarbonization Strategy for Koreas Transport Sector: Integrating BU-CGE Soft-Linking for the Private Car Transition Pathway"
Authors: Lee, Jeongeun, Hanul Jung and Hoon Chang


Abstract
This work is still in progress (DRAFT: NOT FOR PUBLICATION)
As global efforts to address the climate crisis accelerate, Korea is implementing strategies to achieve 2050 net-zero and its 2030 NDC. Korea's transportation sector accounts for ~98 million tons of CO2 (~14% of national total), with 96% from roads. Existing evaluations face key limitations: bottom-up models lack macroeconomic feedback, while CGE models oversimplify technological heterogeneity. Therefore, this study constructs a road transport bottom-up model (KICAT-Transport) for private vehicles—60% of Korea's transport emissions—and soft-links it with a CGE model to combine technological precision with macroeconomic consistency. The Policy scenario incorporates ZEV price reductions, fuel efficiency improvements, linear subsidy phase-outs through 2050, and hydrogen price reductions.
Standalone results project eco-friendly vehicles comprising ~55% of new sales by 2030 (BEV 42%, HEV 12%), with a 91% emissions reduction by 2050. However, a 'market relapse' to diesel occurs for vans as subsidies diminish and ZEVs lose cost parity—exposing the winner-takes-all limitation of LP models and the absence of economies of scale under exogenous pricing.
In the CGE-linked model, rising electricity prices and household budget constraints moderate EV adoption, extending the role of HEVs. The difference between standalone and linked results was modest, and factor cost changes from automotive manufacturing were not captured as linkage variables—a limitation for future refinement.


Resource Details () GTAP Keywords
Category: 2026 Conference Paper
Status: Published
By/In: Presented during the 29th Annual Conference on Global Economic Analysis (Kyoto, Japan)
Date: 2026
Version: Still in progress
Created: Lee, J. (4/15/2026)
Updated: Lee, J. (4/15/2026)
Visits: 84
- Climate change policy
- Domestic policy analysis
- Transportation
- Partial and general equilibrium models


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Last Modified: 4/30/2026 12:56:16 PM