Abstract
This paper analyzes the macroeconomic effects of carbon and energy taxes using an R&D-based endogenous growth model that includes carbon reduction technology. We compare a scenario in which a government develops carbon reduction technology with one in which a private firm is in charge. We find that an energy tax is more effective when a government develops carbon reduction technology, while a carbon tax is better when a private firm develops reduction technology. In addition, degree of carbon emission elasticity causes the difference between the scenarios. Even in an economy with only a carbon tax, the degree of carbon emission elasticity greatly influences the economic growth rate and social welfare. This finding implies that policy design should consider carbon emission elasticity if carbon and energy taxes are introduced simultaneously.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
