In the productionfunction, the paperderivedChina'sactualtrendof the marginalcost function under the assumption that there is adequatesupplyof labor in the coalindustry.
For example, some researchers find that the economy-wide costof a carbon tax would be considerably lower if the revenue were used to reduce marginal tax rates on labor, capital, or personal income than if it were used to offset costs imposed on low-income households.