New CAKE article at the Central European Economic Journal

New CAKE article at the Central European Economic Journal

New CAKE article at the Central European Economic Journal

CAKE team published at Central European Economic Journal new article “Worker’s Earnings Losses Due to the Low-Carbon Transition. Theory and Application in a CGE Model” by Jan Witajewski – Baltvilks, Jakub Boratyński, Robert Jeszke, Maciej Pyrka. 

The latest paper published in the  by the CAKE team presents the methodology for estimating the earnings losses of workers affected by the phase-out of carbon-intensive sectors.

Using sectoral labour supply curves within a Computable General Equilibrium (CGE) model, the study quantifies the income loss experienced by workers when they move into industries that offer lower returns on their skills.

When applied to Poland, the results show that climate policies could reduce workers earnings by around $1 billion by 2040 – approximately 0.5% of total labour compensation. While these losses are manageable at the national level, they can be highly concentrated in coal-dependent sectors, posing a significant political challenge to ambitious climate action.

Crucially, this methodology is not limited to Poland – it can be applied to any sector in any country, making it a versatile tool for policymakers seeking to design just transition strategies that compensate affected workers and build support for decarbonisation.

Read the full article in the Central European Economic Journal: https://lnkd.in/davJt-Attps://doi.org/10.2478/ceej-2025-0012