Environmental Tax Reform with Vertical Tax Externalities in a Federal State
AbstractThe paper studies a regional environmental tax reform in a federal state. In a model with immobile labour, mobile capital and mobile polluting input in the production function, one region increases its pollution taxes and recycles the excess tax revenues by lowering either pre-existing distorting labour or capital taxes. This choice determines whether the non-environmental efficiency of the regional tax system improves or gets worse. Moreover, the regional tax reform changes the level of the federal budget through the vertical tax externality effect. We illustrate the magnitude of the different effects with simulations for a country with only 2 regions (Belgium) and a country with 50 regions (US).
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Katholieke Universiteit Leuven, Centrum voor Economische Studiën, Energy, Transport and Environment in its series Energy, Transport and Environment Working Papers Series with number ete0404.
Length: 24 pages
Date of creation: May 2004
Date of revision:
Contact details of provider:
Postal: Naamsestraat 69, 3000 Leuven
Phone: +32-(0)16-32 67 25
Fax: +32-(0)16-32 67 96
Web page: http://www.econ.kuleuven.be/ew/academic/energmil
More information through EDIRC
Tax Reform; Tax externality; Federalism; Tax Burden; Capital Mobility;
Find related papers by JEL classification:
- H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
- H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
- R13 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General Equilibrium and Welfare Economic Analysis of Regional Economies
- R53 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Public Facility Location Analysis; Public Investment and Capital Stock
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-12-02 (All new papers)
- NEP-ENV-2004-12-02 (Environmental Economics)
- NEP-GEO-2004-12-02 (Economic Geography)
- NEP-PBE-2004-12-02 (Public Economics)
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Kiuila, Olga & Peszko, Grzegorz, 2006. "Sectoral and macroeconomic impacts of the large combustion plants in Poland: A general equilibrium analysis," Energy Economics, Elsevier, vol. 28(3), pages 288-307, May.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Isabelle) The email address of this maintainer does not seem to be valid anymore. Please ask Isabelle to update the entry or send us the correct address.
If references are entirely missing, you can add them using this form.