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Carbon Taxes and the Composition of New Passenger Car Sales in Europe

Author

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  • Orkhan Nadirov

    (School of Public and International Affairs, ADA University, 61 Ahmadbay Agha-Oglu Street, Baku 1008, Azerbaijan)

  • Jana Vychytilová

    (Faculty of Management and Economics, Tomas Bata University in Zlin, Mostní 5139, 760 01 Zlín, Czech Republic)

  • Bruce Dehning

    (Faculty of Management and Economics, Tomas Bata University in Zlin, Mostní 5139, 760 01 Zlín, Czech Republic
    Argyros School of Business and Economics, Chapman University, One University Drive, Orange, CA 9166, USA)

Abstract

This paper examines the effectiveness of implementing carbon taxes to reduce carbon dioxide emissions from transport. Using the system Generalized Method of Moments estimator, we utilize cross-country analysis for the first time to study the impact of carbon taxes on the composition of petrol versus diesel passenger cars sold in 17 countries over the period 2013–2017. The results suggest that increasing carbon taxes affects consumer behavior, causing a significant shift from petrol to diesel fuel vehicles, controlling for factors such as the price of passenger cars, fuel price, interest rates, income level, population density, inflation, and vehicle stock.

Suggested Citation

  • Orkhan Nadirov & Jana Vychytilová & Bruce Dehning, 2020. "Carbon Taxes and the Composition of New Passenger Car Sales in Europe," Energies, MDPI, vol. 13(18), pages 1-15, September.
    • Handle: RePEc:gam:jeners:v:13:y:2020:i:18:p:4631-:d:409631
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    References listed on IDEAS

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    Cited by:

    1. Katsuyuki Nakano & Ken Yamagishi, 2021. "Impact of Carbon Tax Increase on Product Prices in Japan," Energies, MDPI, vol. 14(7), pages 1-19, April.

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