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Determining the Environmental Effects of Indirect Subsidies


Author Info

  • Cees van Beers

    (Dept of Economics, Delft University of Technology)

  • Jeroen C.J.M. van den Bergh

    (Vrije Universiteit Amsterdam and Autonomous University Barcelona)

  • Andr� de Moor

    (National Institute for Public Health and the Environment, Bilthoven, the Netherlands)

  • Frans Oosterhuis

    (Institute for Environmental Studies, Vrije Universiteit Amsterdam)


Up to now a clear theoretical and methodological framework for economic-environmental analysis of environmentally damaging subsidies is lacking. Environmentally damaging subsidies are all kinds of direct and indirect subsidies aimed at achieving a certain (often non-environmental) goal that produce negative external effects to the natural environment. This article develops a transparent method to determine the environmental impact of indirect government subsidies and derive policy lessons. This method has been applied to several major subsidies in the Netherlands, namely in agriculture, energy, and transport. The results reveal large environmental effects, which need to be taken seriously by policy makers. The method enables policy makers to evaluate the environmental impacts of indirect government subsidies.

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Bibliographic Info

Paper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 04-047/3.

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Date of creation: 27 Apr 2004
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Handle: RePEc:dgr:uvatin:20040047

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Keywords: subsidies; environmental economics; environmental management; policy;

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  1. David, Paul A, 1985. "Clio and the Economics of QWERTY," American Economic Review, American Economic Association, American Economic Association, vol. 75(2), pages 332-37, May.
  2. van Beers, Cees & van den Bergh, Jeroen C. J. M., 2001. "Perseverance of perverse subsidies and their impact on trade and environment," Ecological Economics, Elsevier, Elsevier, vol. 36(3), pages 475-486, March.
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