This paper aims to analyse the impact of a recycling mechanism of a carbon tax levy in the East Asia region in terms of economic growth, carbon emission, and welfare distribution. To achieve this goal, this paper uses a multi-country computable general equilibrium for East Asia to conduct the analysis. This paper finds that depending on the type of recycling mechanism, carbon intensity and economy structure, a country could achieve double dividend, rebound effect, or contraction of both output and carbon emission. Regarding welfare distribution, this paper finds that recycling mechanisms could alter the distribution pattern across the country.

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