Pollution Tax Research Articles

Green innovation ecosystem evolution: Diffusion of positive green innovation game strategies on complex networks

The essence of the evolution of the green innovation ecosystem is the process by which the positive strategy of green innovation spreads in a complex network. In this study, the "Object-Technology-Environment-Management-Culture (OETMC)" structure paradigm of innovation ecosystems is presented, and a causal analysis framework of green innovation ecosystem evolution based on green innovation behavior strategy, supported by green innovation efficiency and focused on green innovation ecosystems is developed. Based on this framework, the structure of the green innovation ecosystem and the diffusion process of positive green innovation in the network are discussed. The results reveal the following. (1) The complexity of the green innovation ecological network has visibly improved, but numerous blank connections remain. These are the key constraints that hinder structural evolution. (2) The appearance of a large number of long-range connections weakens the constraint of geographical distance but also hinders edge nodes from joining the network. (3) The existence of preference attachment and power law distribution of the green innovation ecological network leads to the incomplete convergence of positive green innovation strategy at any initial strategy ratio. (4) Default cost and pollution tax rate ensure the enthusiasm of green innovation actors to seek innovation cooperation by increasing opportunity costs, thus accelerating the formation and reconstruction of the green innovation ecological network. These conclusions provide a decision-making reference for governments to encourage green innovation subjects to formulate targeted policies.

An Austrian Critique of Using Carbon Taxes to Manage Climate Catastrophe Risk

Revising and extending the neoclassical rationale for pollution taxes, some economists have attempted to justify a carbon emissions tax as a way for the state to manage systemic climate risks for society. Deploying an approach to risk management commonly seen in financial markets, they depict a tax on carbon-based energy as a hedge against climate catastrophe. The Austrian school of economics has illuminated the conceptual defects of the neoclassical framework around welfare economics, market failure, negative externalities, and socialist economic planning generally. The risk management rationale for carbon taxes suffers from the same calculation and knowledge problems that encumber other state-centric schemes. This article critiques the proposed use of carbon taxes as climate risk insurance on the grounds that systemic risks are not insurable. Moreover, future climate costs cannot be calculated due to their subjectivity, the passage of time, and the absence of demonstrated preferences regarding property values. Both climate risk models and carbon tax cost-benefit models employ flawed assumptions and utility functions. This article proposes a strategic shrinking of the state’s role in economic affairs and a return to sound money as superior ways to mitigate a society’s climate disaster risks.

Economics Analysis of Pollution Control Needs Towards a Balance Development

In the pursuit of economic progress, pollution has emerged as a formidable challenge, threatening both human health and environmental stability. This study examines the economic analysis of pollution control, emphasizing the crucial need to harmonize development with environmental preservation. Through a thorough exploration of pollution's effects and its wide-ranging impacts on human health and ecosystems, this research highlights the pressing requirement for implementing pollution taxes. These taxes serve as pivotal instruments in addressing the externalities caused by pollution, ensuring that genuine environmental costs influence economic decision-making. The study's findings underscore the significant toll of pollution on human well-being, encompassing various health complications and incurring substantial social and healthcare costs. Furthermore, environmental degradation resulting from pollution significantly impacts economic sectors such as agriculture, tourism, and overall productivity. This analysis elucidates the intricate relationship between pollution control, economic growth, and sustainable development. It stresses the necessity of integrating pollution control measures into economic policies to foster a more balanced and resilient development trajectory. The research advocates for a holistic approach that integrates economic incentives, stringent regulations, technological advancements, and community involvement to effectively curb pollution. By emphasizing the role of pollution taxes and acknowledging the true costs of environmental degradation, policymakers can pave the way for a more sustainable and harmonious coexistence between economic progress and environmental preservation.

Constructing and implementing a green taxation system in China under the dual-carbon target

Reducing carbon dioxide emissions and achieving carbon neutrality have become hot topics of global concern. China has elevated its response to climate change to a national strategic level, where the green tax system plays a crucial role in implementing the dual-carbon strategy. This paper systematically analyzes the green tax systems of the Organisation for Economic Co-operation and Development (OECD)—encompassing environmental pollution taxes, energy taxes, vehicle and transportation taxes, and resource taxes. Based on this analysis, it proposes that China should establish a multifaceted green tax system including environmental protection tax, resource tax, and farmland occupation tax. Furthermore, it suggests an integrated approach combining systematic tax incentives such as corporate income tax, value-added tax, consumption tax, and vehicle purchase tax. This comprehensive green taxation framework, covering development, production, consumption, and emission stages, aims to drive high-quality green economic and social development through both tax incentives and restrictions, implementing a “dual-driving” mechanism. This study provides a basic framework and practical path for building a green tax system in China, especially studying the sources of different green taxes and their interrelationships, which enriches the theoretical and practical values related to taxation.

Do Energy Consumption and CO2 Emissions Significantly Influence Green Tax Levels in European Countries?

In this article, we analyze the correlation between GDP/capita variation, primary and renewable energy consumption and greenhouse gas emissions on the one hand, and green taxes on the other. Green taxes are the main instruments used to limit activities that have a negative impact on the environment. These consist of taxes paid by producers and/or consumers for any activity that generates pollution. The results of dynamic regressions, validated by the applied robustness tests, indicate a significant and positive correlation between primary energy consumption and total environmental taxes, respectively energy taxes. At the same time, this shows that variation in GDP/capita significantly and positively influences transport taxes and pollution taxes. In contrast, net greenhouse gas emissions and the supply, transformation and consumption of renewable sources and waste do not significantly influence the total green taxes and their components. This finding is useful to both academic research and government policies for the realistic substantiation of the levels of green tax revenues and for establishing appropriate measures meant to reduce CO2 emissions.

Economics Analysis of Pollution Control Needs Towards a Balance Development

In the pursuit of economic progress, pollution has emerged as a formidable challenge, threatening both human health and environmental stability. This study examines the economic analysis of pollution control, emphasizing the crucial need to harmonize development with environmental preservation. Through a thorough exploration of pollution’s effects and its wide-ranging impacts on human health and ecosystems, this research highlights the pressing requirement for implementing pollution taxes. These taxes serve as pivotal instruments in addressing the externalities caused by pollution, ensuring that genuine environmental costs influence economic decision-making. The study’s findings underscore the significant toll of pollution on human well-being, encompassing various health complications and incurring substantial social and healthcare costs. Furthermore, environmental degradation resulting from pollution significantly impacts economic sectors such as agriculture, tourism, and overall productivity. This analysis elucidates the intricate relationship between pollution control, economic growth, and sustainable development. It stresses the necessity of integrating pollution control measures into economic policies to foster a more balanced and resilient development trajectory. The research advocates for a holistic approach that integrates economic incentives, stringent regulations, technological advancements, and community involvement to effectively curb pollution. By emphasizing the role of pollution taxes and acknowledging the true costs of environmental degradation, policymakers can pave the way for a more sustainable and harmonious coexistence between economic progress and environmental preservation.

Evolutionary Game Analysis of Green Supply Chain Management Diffusion under Environmental Regulation

The continuous deterioration of the ecological environment and the increasing scarcity of resources have posed a serious challenge to the survival and development of human beings, and the implementation of green supply chain management (GSCM) in this context is an effective means to ensure the sustainable development of society and the economy. In order to seek the optimal strategy of evolutionary game in the implementation of green supply chain management and explore the influence of environmental regulation intensity and public preference degree on the evolution process of green supply chain management diffusion development, this paper takes the study of green supply chain management diffusion as the core innovation point, and under the premise of environmental regulation, selects the government, the core enterprise, and the public as the participating bodies of green supply chain management diffusion, and uses the theory of evolutionary game to construct a diffusion model of green supply chain management. Using evolutionary game theory to construct a diffusion model, and with the help of MATLAB and other mathematical tools for numerical simulation analysis, we discuss the diffusion of the green supply chain and derive the optimal combination strategy. The results of the study show that: (1) there are four evolutionary stable states in the process of green supply chain management diffusion: preliminary diffusion, extinction, semi-diffusion, and full diffusion; (2) it will be beneficial for the government to promote the evolutionary diffusion of green supply chain management by implementing a higher intensity of pollution tax policy while implementing green supply chain incentive strategies; (3) the government, while implementing environmental regulation policies, should also pay attention to the guidance of the public’s awareness of environmental friendliness and greenness, and focus on the role of the comprehensive strategy selection of the three parties of the game in reaching the optimal state. The conclusions of the study provide theoretical guidance and decision support for the implementation and diffusion of green supply chain management under environmental regulation.

The effect of renewable energy aid and governance quality on environmental tax effort in Sub-Saharan Africa

The literature on foreign aid and tax efforts largely overlooks the specific role of environmental aid and taxation. To fill this gap, we examine the effects of renewable energy development assistance (EDA) and governance quality on climate change tax effort, air pollution tax effort, and aggregate environmental tax effort in Sub-Saharan Africa (SSA). Utilizing panel data from 15 SSA countries over 20 years (2000–2019), the sample is divided into two groups based on income levels: seven low-income countries (LIC) and eight middle-income countries (MIC). The instrumental variable generalized method of moments (IV-GMM) regression technique is employed to estimate the parameters of the baseline model specifications. The study also uses the Smoothed Instrumental Variable Quantile Regression (SIVQR) technique to test the robustness of the baseline model. Among middle-income SSA countries, the findings suggest that renewable energy aid inflows reduce climate change tax efforts but increase air pollution and aggregate environmental tax efforts. However, among low-income SSA countries, renewable energy aid negatively impacts all three categories of environmental tax efforts. Governance quality tends to enhance all three categories of environmental tax effort in both low-income and middle-income SSA countries. The implications of these results are discussed.

Complementary taxation of carbon emissions and local air pollution

Current decarbonization policies neglect damages from local air pollutants. We analyze the trade-off between complementary taxation of carbon emissions and local air pollution. We quantify results for the European power market until 2050. Taxing only air pollution results in system cost of 6,475 billion € and fosters nuclear deployment. Additional external cost accumulate to 5,890 billion €. Taxing only carbon yields system (external) cost of 8,263 (717) billion € and promotes carbon-capture-and-storage deployment. Taxing both yields (external) cost of 7,697 (1,118) billion €. Moderate carbon taxation can be complementary to a primary policy of air pollution abatement. On the contrary, a primary policy of decarbonization stands in trade-off with air pollution abatement in the long-term.

Could Environmental Regulations Reduce Energy Consumption: Evidence From China’s Implementation of an Environmental Pollution Tax

This article investigates the impact of environmental regulations on energy consumption. As the main way for the government to protect the environment, the implementation of environmental pollution tax has played an important role in China’s energy consumption. This article uses data from the implementation of environmental pollution tax in Chinese cities to match with urban energy consumption data, and uses the difference-in-difference method (DID) to estimate the impact of environmental regulations on energy consumption. We find that the implementation of environmental pollution tax has reduced energy consumption, but this effect is mainly effective in the central and western regions and two-controlled areas. Further analysis shows that the reduction of energy consumption by environmental pollution tax is mainly attributed to improving technological innovation capabilities, optimizing industrial structure, and increasing tax collection intensity. The results in this study provide evidence for achieving an environmentally friendly society and sustainable development.

Environmental protection taxes and green productivity: Evidence from listed companies in China

Enforcing an environmental protection tax is a pivotal institutional measure for addressing environmental and climate change challenges and marking a substantial advancement in ecological development. This study aims to explore the influence of environmental protection taxes on the "green" productivity of the manufacturing industry through an analysis of Chinese listed companies. Initially, the Dynamic Slacks-Based Measure (DSBM) method is employed to estimate the "green" production efficiency levels of 175 listed companies in China from 2016 to 2020. Subsequently, by aligning pollution tax standards issued by local governments and relevant environmental protection departments with microlevel data from the CSMAR database, wind database, listed company annual reports, and social responsibility reports, the sample was refined to 833 data points. Using the implementation of the environmental protection tax policy in 2018 as a natural experiment, a Difference-in-Differences (DID) model is applied for empirical testing. The empirical results reveal a counterintuitive negative correlation between the environmental protection tax and the "green" productivity of companies, contradicting the predictions of the Porter hypothesis. This suggests that stringent environmental regulations hinder the development of green technologies. The adverse impact of environmental protection taxes on "green" productivity is attributed to heightened environmental legitimacy pressures and increasing environmental uncertainty risks companies face. Further exploratory analysis indicated that the digital economy and green finance have a positive moderating effect, significantly mitigating the negative impact of environmental protection taxes on companies' overall "green" productivity. Consequently, dynamically optimizing environmental tax policies is imperative to alleviate companies' environmental legitimacy pressures and uncertainty risks. Additionally, capitalizing on the opportunities the digital economy presents and leveraging green finance policies have emerged as effective strategies for realizing the Porter effect of environmental protection taxes.

Examining the environmental tax and the fishing grounds footprint nexus: Case of the African fishing industry

AbstractThe implementation of environmental stringent policies faces a trade‐off between ensuring livelihood sustainability and reducing global fishing footprints. This study investigates the impact of environmental tax on fishing footprints in 23 African countries from 2000 to 2018, using the smoothed instrumental‐variables quantile regression approach. The need to establish a sustainable fishing business in Africa, considering the growing fishing footprint, and investigate if environmental levies could help achieve this goal are the driving forces behind this study. The findings reveal that environmental tax reduces footprints in African fishing grounds up to the 0.75th quantile, beyond which its impact remains insignificant in its conditional distribution. More importantly, environmental tax stringency‐reducing impacts are only apparent in the coastal and middle‐income groups up to the 0.90th and 0.50th quantiles, respectively. Environmental tax appeared to only contribute to reducing fishing footprints beyond the 0.75th quantile with higher levels of pollution tax across its conditional distribution in landlocked countries, but remaining insignificant in the low‐income group. The insignificant impact on the low‐income group is due to relatively relaxed environmental regulations that are unable to address the ecological deficit. The findings further indicate that digital infrastructures and financial development can contribute to enhancing fishing grounds biocapacity, in promoting environmental awareness and ecofriendly strategies. These findings are significant because they show that, regardless of whether environmental standards are governed by common law or civil law legal systems, environmental taxes can be utilized to stop deleterious ecoenvironmental practices within the African fishing industry. The study recommends that policy makers adopt more stringent environmental regulations, particularly for the landlocked countries, whose limited fishery grounds biocapacity has dropped in recent years.

Revenues from Environmental Taxes, with Emphasis on Pollution Taxes during the Corona Crisis

Improving the quality of the environment and reducing its pollution should be a global priority. Many countries are developing their environmental policies and trying to achieve their objectives through a variety of instruments. This paper highlights the application of economic instruments of environmental policy. It focuses on the analysis of environmental tax revenues in the European Union and in Slovakia, with a focus on the period of the Covid-19 pandemic. It then focuses on the analysis of a specific pollution tax in Slovakia, highlighting the factors that influenced its level.

The Effect of Green Taxation on Financial Performance of Selected Oil and Gas Firms in Nigeria.

This study investigated the effect of green taxation on financial performance of selected oil and gas firms in Nigeria for the period 2017-2022. The specific objectives were to investigate the effect of carbon emission taxes; to find out the effect of petroleum profit tax; and to investigate the effect of industrial pollution tax on financial performance of selected oil and gas firms in Nigeria for the period 2017-2022. The model included the total assets of the oil and gas firms as dependent variable. The study adopted ex post facto research and employed times series data sourced from the annual financial records of the oil and gas firms, and the Federal Inland Revenue Service (FIRS). Evidence of longrun relationship was found among the model variables through the Johansen test, and a fast speed of adjustment at 32.01% annually. The major findings of the study are: carbon emission taxes had significant negative effect on financial performance of oil and gas firms in Nigeria; petroleum profit tax has significant negative effect on financial performance of oil and gas firms in Nigeria; and industrial pollution tax has significant negative effect on financial performance of oil and gas firms in Nigeria. Based on the findings, the study concluded that green taxation had significant negative effect on the financial performance of oil and gas firms in Nigeria. The study recommended that: the policymakers should design a strategy toward reviewing the carbon emission taxes due to evidence of negative shock on the oil and gas firms; the petroleum profit tax should also be reviewed down in order to mitigate risks arising from their operation which affect their performance; the government should further increase the industrial pollution tax rate, this will deter industries from indiscriminate pollution of the environment, restore investor confident and stabilize stock market in Nigeria.

Creative destruction vs destructive destruction: A Schumpeterian approach for adaptation and mitigation

This article aims to demonstrate how a market exposed to a catastrophic event strives to find a balance between adaptation and mitigation policies through R&D strategies. Our analysis reveals that, within our framework, there exists no trade-off between adaptation and mitigation. Rather, the critical relationship exists between adaptation and pollution because adaptation (wealth accumulation) increases the growth rate of the economy, leading to a higher flow pollution due to the scale effect. We also investigate the long-run effects of pollution taxes on growth rates and the influence of the probability of catastrophic events on these outcomes. Our findings suggest that even with a higher likelihood of catastrophe, the economy can elevate its R&D endeavors, provided that the penalty rate stemming from an abrupt event remains sufficiently high and the economy confronts a risk of a doomsday scenario. Additionally, we illustrate that pollution taxes can foster heightened long-term growth, with the positive effects being more pronounced when the probability of catastrophe is elevated, assuming an adequately substantial penalty rate. Finally, we find that pollution growth can be higher with less polluting inputs due to a scale effect, a phenomenon akin to the Jevons-type paradox.

Collaborative government-public efforts in driving green technology innovation for environmental governance in PPP projects: a study based on prospect theory

PurposeThe paper aims to elucidate effective strategies for promoting the adoption of green technology innovation within the private sector, thereby enhancing the value of public–private partnership (PPP) projects during the operational phase.Design/methodology/approachUtilizing prospect theory, the paper considers the government and the public as external driving forces. It establishes a tripartite evolutionary game model composed of government regulators, the private sector and the public. The paper uses numerical simulations to explore the evolutionary stable equilibrium strategies and the determinants influencing each stakeholder.FindingsThe paper demonstrates that government intervention and public participation substantially promote green technology innovation within the private sector. Major influencing factors encompass the intensity of pollution taxation, governmental information disclosure and public attention. However, an optimal threshold exists for environmental publicity and innovation subsidies, as excessive levels might inhibit technological innovation. Furthermore, within government intervention strategies, compensating the public for their participation costs is essential to circumvent the public's “free-rider” tendencies and encourage active public collaboration in PPP project innovation.Originality/valueBy constructing a tripartite evolutionary game model, the paper comprehensively examines the roles of government intervention and public participation in promoting green technology innovation within the private sector, offering fresh perspectives and strategies for the operational phase of PPP projects.

Environmental regulation stringency and allocation between R&D and physical capital: A two-engine growth model

Many studies have identified the negative effect of environmental regulation on capital accumulation and the positive effect on innovation, but this observed capital-innovation tradeoff due to environmental regulation lacks theoretical underpinning. We fill this gap by developing a unified two-engine endogenous growth model with environmental regulation, and show that a stringent environmental policy (in terms of pollution tax) leads to a sectoral reallocation from dirty inputs to clean final-good sectors, which increases the demand for R&D and activates the innovation engine. The capital engine depends on the elasticity of substitution between polluting and capital inputs. If both are sufficiently complementary, capital accumulation slows down. Another novelty of our model is that the contrasting responses of the two growth engines can lead to an inverted-U relation between overall GDP growth and environmental taxation. Our calibration shows that a well-designed environmental regulation can achieve a “double dividend”: both improving the environment and enhancing economic growth and social welfare. Our empirical analysis provides macro-level evidence to justify our model prediction by using cross-country panel data.

Environmental tax and highly polluting firms' green transformation: Evidence from green mergers and acquisitions

Taking China's Environmental Protection Tax Law, implemented in 2018, as an exogenous shock, this study investigates the effect of an environmental tax on firms' green transformation behaviors. Our baseline results show that this environmental tax policy has a positive impact on promoting highly polluting firms' green mergers and acquisitions (M&As). Heterogeneity analyses show that the effect of the environmental tax on green M&As is moderated by firm characteristics (state ownership, innovation capacity, and reputation), industry ones (competition and barriers to entry), and regional ones (legal system strength, environmental pollution severity, and pollution tax rates). Finally, we find that the capital market responds more positively to green M&As in highly polluting firms after the implementation of the environmental tax. This study has important policy implications, providing empirical evidence that may be useful for corporate green transformation.

THE IMPACT OF ENVIRONMENTAL TAXES ON TRANSPORTATION AND STORAGE ENTERPRISES’ DEVELOPMENT – THE CASE OF BALKAN COUNTRIES

Sustainable development counteracts climate change and strives for a good quality of life. It is a development based on economic, social and environmental goals which should be evaluated. Environmental taxes have to ensure enterprises’ development follows sustainability principles. The basis of environmental taxes is a physical unit of harmful substance emissions with a proven negative impact on the environment. The article’s main objective is to assess the impact of environmental taxes (Envtax) on the sustainable development of the transportation and storage enterprises (Susd) (NACE Rev. 2: H) from 2008 to 2018. We created integrated indicators of sustainable development and its components, single-equation and multi-equation models (the OLS estimation) and Model Autoregressive Moving Average with eXogenous (ARMAX) to verify the research hypothesis. The research results indicate that energy (Entax t), transport (Trtax) and pollution taxes (Poltax) from current and previous period significantly affect the development of transportation and storage enterprises within sustainability principles (economic: Ed, social: Sd, and environmental: Envd). There is a strong variation in the strength and direction of the impact of environmental taxes on the development of the transportation and storage enterprises following sustainability principles in Bulgaria, Croatia, Romania, and Slovenia from 2008 to 2018. The results indicate that taxes are not effectively used and that implementing reforms in the European Union in this area is the right direction.

Thermodynamic performance study of large-scale industrial gas turbine with methane/ammonia/hydrogen blended fuels

The fuel interchangeability range without any modifications was proposed within 5% of Wobbe index (WI) by the gas turbine manufacturers. The system modifications, especially in combustor, are needed with the out-of-range 5% of WI. In this study, the thermodynamic performances were studied with the fuels exceeding 5% of WI, the focused fuel compositions were ammonia and hydrogen for eco-friendly power generation and carbon neutrality. A performance analysis was conducted for a J-class gas turbine wherein ammonia and hydrogen were mixed with conventional liquefied natural gas (LNG) fuel. The maximum mixable ratio of ammonia is 76%, and fuels with higher mixable ratio cannot achieve a high turbine inlet temperature (1873 K). 100% hydrogen can be used with stable operation if the flame stability is guaranteed by developing a new combustor with conventional compressor and turbines. Environmental–economic analysis was also conducted to study the effect of carbon-neutral fuel on air pollution. Mixing hydrogen is a highly effective method to reduce the air pollutant tax; however, mixing ammonia is not suitable for decreasing air pollutants. As ammonia emits enormous NOx, an after-treatment system is required to use ammonia as a carbon-neutral fuel.