Comparing climate pledges and eco-taxation in a networked agricultural supply chain organisation

This paper examines the effectiveness of climate pledges and eco-taxation as strategies for mitigating climate change within a networked agricultural supply chain organisation. We utilise variational inequality techniques within a multicriteria decision-making framework and validate our theoretical findings through numerical simulations using a machine learning augmented algorithm. By employing this approach, we position the Agricultural Sector Roadmap, aimed at capping global warming at 1.5 degrees C, within the wider agricultural sector's climate action framework. Our results demonstrate that environmental taxation emerges as the most effective approach for addressing climate change. Eco-taxation leads to a 57.87 per cent reduction in global emissions, whereas climate pledges only account for a 20.59 per cent reduction at the same level of production. Furthermore, eco-taxation results in a 45.68 per cent greater reduction in emission intensity compared to climate pledges. In contrast to climate commitments, an eco-fiscal policy is capable of achieving the objectives established by the European Union.