Revenue Redistribution Research Articles

Carbon Trading and Environmental Justice: A Juridical Examination of Fairness in Indonesia's Emissions Reduction Initiative

This paper provides a normative juridical analysis of Indonesia's carbon trading regulations, with a focus on environmental justice and fairness. It examines the legal framework established by Presidential Regulation No. 98 of 2021, which governs carbon pricing mechanisms, including carbon taxes and carbon credit trading. The analysis highlights key gaps in the regulation, particularly in terms of equitable benefit distribution and inclusion of vulnerable communities in decision-making processes. While Indonesia's carbon trading system aligns with global trends and its international obligations, significant improvements are needed to ensure that marginalized groups are not further disadvantaged. Recommendations include the redistribution of carbon trading revenues, enhanced public participation, stronger enforcement mechanisms, and alignment with international best practices.

Տնտեսական աճի ներառականությանը միտված հարկաբյուջետային քաղաքականության միջազգային փորձ / International experience with fiscal policies for inclusive economic growth

The challenge for macroeconomic policy is to integrate policies that support economic growth and create and expand equal opportunities to participate in and benefit from the economy. This includes policies to improve the functioning of labour markets, reduce discrimination, support equal access to education and skills, and increase economic and financial inclusion in all parts of society. The idea of inclusive economic development has been introduced into academic discourse in recent decades and has become one of the main guidelines for economic policy makers and implementers in many countries around the world. The policy of formation and redistribution of public revenues through the state budget is important from the point of view of overcoming the existing inequalities in society and solving the problems of inclusiveness. Therefore, it is important to activate public policy with fiscal policy instruments, to increase its effectiveness in the context of ensuring inclusiveness of economic growth, mitigating inequality in the distribution of income and national wealth. This article studies and interprets the international experience and specific features of the application of fiscal policy oriented to the inclusiveness of economic growth, which is especially important from the point of view of identifying opportunities for its localisation in the Republic of Armenia. The conclusions drawn can be useful in the development of solutions aimed at increasing the inclusiveness of fiscal policy in the Republic of Armenia.

Spatial effects of carbon pricing on transport equity

There is an ongoing process that greenhouse gas emissions of transport will be incorporated in the European Emissions Trading System. The cap-and-trade approach will result in substantial price increases for fossil fuels which will affect affordability of the transport systems. Within this paper the regressive effect on car-owning households is described in different area categories of the urban and rural region in Germany. Equal-per-household redistribution of the carbon revenue could reverse the regressive effect into a progressive effect. However, there is substantial variation within the different economic status groups leaving notable shares of households with a very low economic status without a positive net transfer. This share will be lowest in the metropolises of the urban region and highest in small-sized cities/village areas of the urban and rural region. Particularly in the latter area categories, these households may need temporary mobility allowances due to limited abatement options. Despite the environmental bonus, electric car-owning households still belong to groups of higher economic status, and public transport supply is limited, particularly in the small-sized cities/village areas of the urban and rural region.

Tariff-Growth Association through Tariff Revenue Redistribution and Labor Reallocation

Tariff-Growth Association through Tariff Revenue Redistribution and Labor Reallocation

Impacts of emission trading scheme in Vietnam: A perspective of revenue redistributions

AbstractWith ambitious emission reduction targets presented in the international commitments, Vietnam has a pathway to implement an emission trading scheme (ETS) to curb its carbon emissions. However, research on the impacts of ETS in Vietnam is still unclear, especially since there is no study on ETS revenue redistribution policies. By developing a computable general equilibrium (CGE) model, this paper simulates the potential impacts of the ETS with different revenue redistribution options. The results indicate that to achieve Vietnam's target of 15.8% carbon emission reduction, the carbon price would significantly affect the economy with a GDP drop of 3.7% and a welfare loss of 2.89% of GDP. The revenue redistribution policies would lighten these negative impacts. While transferring to government activities reduces GDP loss, reducing income tax policy results in welfare improvement. At the sectoral level, the electricity sector is most negatively affected and also plays a key role in reducing carbon emissions in Vietnam. The revenue redistribution for government activities could improve outputs for the construction and some heavy industries while the revenue redistribution policy for households creates improvements for light industries and the electricity industry.

Healthcare Across Boundaries: Urban-Rural Differences in the Consequences of Telehealth Adoption

We study the impacts of telehealth adoption on geographic competition among urban and rural healthcare providers. We consider a quasinatural experiment: states’ entry into the Interstate Medical Licensure Compact, wherein the entry events facilitate healthcare providers to adopt telehealth technology. By analyzing a representative sample of providers, we first establish the Compact entry shock’s validity and its positive effect on the supply of medical services. We then report evidence that there are service and payment shifts from rural providers to urban providers (i.e., urban providers are more likely to benefit from the Compact entry financially). Relying on patients’ telehealth reimbursement claim data, we observe two mechanisms contributing to the revenue redistribution: the substitution and gateway effects of telehealth. Finally, we show that telehealth readiness and service quality moderate the impact of telehealth adoption. These findings speak to both potentially positive and negative consequences for welfare.

Social obligations in the logging sector in Cameroon, Ghana, Liberia and Republic of Congo

This paper offers a critical review of the social obligations (revenue redistribution, direct payments, payments in kind, and access to justice or compensation) of logging concessionaires to affected communities in Cameroon, Ghana, Liberia and Republic of Congo. The research draws on a full desk-review of relevant legal texts, and consultation with leading non-governmental organisations working in the forest sector in the four countries. It appears that the legal foundation of social obligations is mainly shaped by national context, and therefore important differences can be observed across countries. However, they are complex, incomplete and precarious, providing opportunities for elite capture, and communities – and the State – not reaping the benefits they are owed by law. A key conclusion is that legality-licensing schemes such as under a Voluntary Partnership Agreement (VPA) with the European Union (EU) tend to downplay social obligations compared to other aspects of legal compliance.

Struggles over Resource Decentralisation: Legislative Reform, Corporate Resistance and Canadian Aid Partnerships in Burkina Faso

In attempting to counter the various negative correlations associated with the mining–development nexus in the global South (for example, the ‘resource curse’ or ‘enclave economies’), the global mining sector experienced a mushrooming of ethical norms, practices and policies during the past three decades, many of them intended to strengthen local communities. In addition to the launch of various initiatives from the corporate world (ranging from multi-stakeholder partnerships on the global level to corporate social responsibility programmes in mining concessions), a number of West African countries have reformed their liberal mining legislation in recent years, thereby introducing new mechanisms for a more just local redistribution of mining revenues. In this spirit, the mining code of Burkina Faso, reformed in 2015, provides the implementation of a Mining Fund for Local Development (FMDL) to which multinational corporations are legally required to contribute 1 per cent of their national turnover (before tax). This chapter investigates multi-scalar policies for decentralised mining revenue allocation in and around Burkina Faso’s gold mining sector by engaging with and contributing to debates in post-structural geography and political ecology. It explores how ‘resource decentralisation’ became a priority of both the national government and of Canadian aid projects in Burkina Faso, while facing political resistance from mining companies. I argue that struggles for local profits from mining transcend specific scales (‘the global’, ‘the national’, or ‘the local’) in resource governance and focus either on promoting the various voluntary engagements of the corporate world or on calling for the state-centred enforcement of legal requirements. In Burkina Faso’s mining areas this has ambivalent outcomes: It leads to a reshuffling of responsibility for the (re-)distribution of mining revenues from corporate agents to municipal decision makers, on the one hand. On the other, it serves to engineer (potential) community unrest, and thus to eventually make large-scale mining feasible in the first place.

The landlord-tenant dilemma: Distributional effects of carbon prices, redistribution and building modernisation policies in the German heating transition

A carbon price on heating fuels aims to reduce the use of fossil energy in the heating sector. However, it has a greater effect on tenants than on landlords. The heating transition requires adequate building insulation for efficient use of low-temperature technologies. To encourage this particular kind of investment, German landlords are given the option to apply a modernisation levy of up to 8% on top of rents. Similar to carbon pricing, rent increases cause distributional effects. The net effect of these measures on tenants has not been analysed so far. Using a micro-simulation integrating representative empirical data on tenant households in Germany from KOSMA and the detailed building database TABULA, we analyse direct distributional effects of a carbon price (€55/t and €250/t), a per-capita redistribution of carbon price revenues and the modernisation levy (8% and 2% rent increases). The analysis shows that carbon prices and modernisation levies have strong regressive effects. These can be mitigated by the per-capita redistribution. However, the effect on tenants within a given income decile varies largely due to the diversity of buildings. Thus, when designing and evaluating policies, looking at average effects is not sufficient to assess economic impacts for individual households.

A merely national ‘universal’ basic income and global justice

A merely national ‘universal’ basic income and global justice

О возможностях налоговой децентрализации в России

During the structural transformation of the Russian economy, it is especially important to ensure the balance of consolidated regional budgets, in particular through tax decentralization. The article presents the results of modeling the redistribution of tax revenues between the federal and regional levels of the budget system. The purpose of modeling was to find such parameters of tax decentralization which do not worsen the horizontal balance of consolidated regional budgets. The scientific novelty of the paper lies in modeling the effects of tax decentralization on the level of differentiation of regional tax revenues according to the latest available tax and budget reporting data for 2019–2022. As a result, it was shown that an increase in regional shares for personal income tax, certain components of the mineral extraction tax, water tax and fees for the use of water biological resources up to 100% will not lead to a significant increase in inter-regional differentiation of tax revenues. The prospects of the study are to take into account the impact of the structural transformation of the economy on the territorial distribution of tax bases and the level of taxation, as well as to detail the calculations for personal income tax and mineral extraction tax as new data are accumulated.

Multi-Micro-Grid Main Body Electric Heating Double-Layer Sharing Strategy Based on Nash Game

In order to promote energy mutual aid among microgrids, expand the types of energy interaction, and improve the utilization of renewable energy, a two-layer sharing strategy for multi-microgrids (MMGs) based on the Nash game is proposed. Firstly, the low-carbon transformation of the micro-grid model is carried out, and the source side is transformed into a comprehensive and flexible operation mode for carbon capture thermal power plants. Then, the multi-microgrid subject electro-thermal double-layer sharing model based on the Nash game is constructed, which is decomposed into a revenue maximization sub-problem and a revenue redistribution sub-problem. In the sub-problem of revenue maximization, considering the lowest operation cost of carbon allowances and stepped carbon trading as the goal, the alternating direction multiplier method is used for a distributed solution. In the revenue redistribution sub-problem, the reasonable redistribution of income is realized by constructing the asymmetric energy mapping contribution function for different periods and energy types. Finally, the simulation results have verified the effectiveness of the proposed method. The results showed that the strategy of this paper can achieve the optimization of the economic objectives of the multi-microgrid (MMG) alliance and has the advantages of reasonable redistribution of benefits, promotion of wind and solar consumption, and reduction of carbon emissions.

A Bubble Doomed to be Pricked Deconstructing the Chinese Real Estate Bubble

China’s real estate housing boom has been a dreadful concern for economists worldwide. This paper analyzes the formation of the Chinese real estate housing bubble and investigates the factors that led to the bubble. Stimulated by the central government’s fiscal pressure, a redistribution of the tax revenues led to China’s local government’s “land financing” strategy, flaming the rise of housing prices. Moreover, due to the global financial crisis of 2008, the Bank of China proposed low-interest rates while the central bank increased credit availability to rejuvenate China’s economic state, which led to long-run damage. Furthermore, the expected traditional filial duty of Chinese parents to prioritize their children’s education as an investment and the obligation of owning a home for males before marriage also triggered the skyrocketing double-digit inflation rates. Finally, economists worry that the increased construction demand due to the rising urban population in the early 1970s will doom the new modern world as the population is now declining, followed by the low demand for housing in the future.

When standards have better distributional consequences than carbon taxes

Carbon pricing is the efficient instrument to reduce greenhouse gas emissions. Nevertheless, the geographical and sectoral coverage of substantial carbon pricing remains low, often due to concerns about increasing economic inequality. Regulations such as fuel economy standards are more popular. Could the reason be that they have an equity advantage over carbon pricing? We develop two models, one representing energy services and the other the carbon-intensity of consumption, to identify the economic situations in which this is the case. First, we prove that an efficiency standard can be more equitable than carbon pricing when consumers prefer high-carbon technology attributes. Evidence from the US vehicle market confirms this finding. Second, we show theoretically, and through a numerical application to the Chinese transport sector, that intensity standards are preferable when richer households consume a greater share of high-emissions goods. Our results hold when the redistribution of carbon pricing revenue is not progressive. These insights may help advance decarbonisation when pricing instruments remain unpopular.

Development of Business Income Tax Revenue (PIT and CIT) in the Visegrad Group Countries (V4) and Its Redistribution

The paper presents the development of business income tax revenue (PIT and CIT) in the V4 countries for the analyzed period 2004 – 2021. It also provides an overview of its redistribution. The primary goal of the research is to present the development of business income tax in the Visegrad Group countries, to approach the redistribution of business income tax revenue in individual Visegrad Group countries. Defined partial goals fulfill the primary goal. Our results provide consistent findings on the development of PITent. and CITent. revenues in individual V4 countries. We identify and analyze the amount of tax revenue from natural persons – entrepreneurs, from legal entities – entrepreneurs, we examine the percentage share of PITent. revenue and CITent. to GDP and percentage redistribution of PITent. and CITent. revenue in V4 countries. The results of the research may create the basis for further research of the tax potential in V4 countries.

Regional variation in tax compliance and the role of culture

This research note analyzes the role of culture on individuals’ tax compliance by focusing on regional differences within a single country: Italy. Southern Italy has long been a focus of research interest, not only for its high rates of tax evasion, but for a host of other social and political ills, all usually attributed to regional culture. Our laboratory tax compliance experiment, conducted in provinces of the northern and southern regions, reveals that taxpayers in the north and south generally behaved alike both in terms of average compliance rates and individuals’ sensitivity to changes in tax structures—except for lower responsiveness to greater redistribution of tax revenues among subjects in Salerno than those in Bologna. This suggests the limited explanatory power of culture in tax compliance in favor of institutional explanations.

Extractivist States: Contesting and Negotiating the “Commodities Consensus” in Bolivia, Ecuador, and Across Latin America

Extractivist States: Contesting and Negotiating the “Commodities Consensus” in Bolivia, Ecuador, and Across Latin America

Co-dynamics of climate policy stringency and public support

Public support for stringent climate policies is currently weak. We develop a model to study the dynamics of public support for climate policies. It comprises three interconnected modules: one calculates policy impacts; a second translates these into policy support mediated by social influence; and a third represents the regulator adapting policy stringency depending on public support. The model combines general-equilibrium and agent-based elements and is empirically grounded in a household survey, which allows quantifying policy support as a function of effectiveness, personal wellbeing and distributional effects. We apply our approach to compare two policy instruments, namely carbon taxation and performance standards, and identify intertemporal trajectories that meet the climate target and count on sufficient public support. Our results highlight the importance of social influence, opinion stability and income inequality for public support of climate policies. Our model predicts that carbon taxation consistently generates more public support than standards. Finally, we show that under moderate social influence and income inequality, an increasing carbon tax trajectory combined with progressive revenue redistribution receives the highest average public support over time.

Pro-poor tourism and income distribution in the second-tier provinces in Thailand

ABSTRACT In Thailand, promoting tourism in 55 second-tier (non-major) tourism provinces is a recent policy tool for reducing poverty and income inequality. A computable general equilibrium (CGE) model linked with socio-economic household survey data shows that increasing domestic and foreign tourism demand in 22 first-tier tourism provinces can reduce the poverty rate, but overall national income inequality increases. However, increasing domestic tourism in the second-tier tourism provinces can slightly decrease income inequality. The model results also show that government collection and redistribution of new tourism-generated tax revenue to the 40% of poorest households significantly diminishes poverty and inequality.

Supporting carbon taxes: The role of fairness

While the economic case for carbon pricing is compelling, public support for it remains low. Using a stated-choice experiment with a sample of 6000 German household heads, we examine how their fairness preferences influence support for carbon taxes under different revenue uses. We find that respondents who prefer green spending are more likely to support a carbon tax, but the support diminishes considerably for higher tax rates – in contrast to respondents who support social cushioning. When restricted to options for direct revenue redistribution, Germans prefer lump-sum payments over directing payments to the poorest or the most affected. Preferences over these options depend both on genuinely different concepts of fairness and economic circumstances. Our findings have implications for advancing carbon pricing, as its support can be increased substantially when designed according to citizens' fairness preferences.