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Economic incentives to reduce pollution from road transport: the case for vehicle characteristics taxes

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  • Johnstone, N.
  • Karousakis, K.

Abstract

Although economists have long been advocating the use incentive-based policies to internalise the external costs of pollution from road transport, implementation of a "pigovian" tax presents considerable practical difficulties. As such, a number of "second-best" policies have been suggested, and this article presents the case for a vehicle characteristics tax. It is argued that such taxes, when used in conjunction with a fuel tax, can lead to outcomes that are more economically efficient than many of the other measures proposed or implemented. The argument is given some support by an analysis of vehicular emissions in the American vehicle stock.

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  • Johnstone, N. & Karousakis, K., 1999. "Economic incentives to reduce pollution from road transport: the case for vehicle characteristics taxes," Transport Policy, Elsevier, vol. 6(2), pages 99-108, April.
    • Handle: RePEc:eee:trapol:v:6:y:1999:i:2:p:99-108
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    References listed on IDEAS

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    Cited by:

    1. Santos, Georgina & Behrendt, Hannah & Maconi, Laura & Shirvani, Tara & Teytelboym, Alexander, 2010. "Part I: Externalities and economic policies in road transport," Research in Transportation Economics, Elsevier, vol. 28(1), pages 2-45.
    2. Timilsina, Govinda R. & Dulal, Hari B., 2008. "Fiscal policy instruments for reducing congestion and atmospheric emissions in the transport sector : a review," Policy Research Working Paper Series 4652, The World Bank.
    3. Pérez-Martínez, P.J. & Vassallo-Magro, J.M., 2013. "Changes in the external costs of freight surface transport In Spain," Research in Transportation Economics, Elsevier, vol. 42(1), pages 61-76.
    4. Laurence Turcksin & Olivier Mairesse & Cathy Macharis & Joeri Van Mierlo, 2013. "Encouraging Environmentally Friendlier Cars via Fiscal Measures: General Methodology and Application to Belgium," Energies, MDPI, vol. 6(1), pages 1-21, January.
    5. Yoshitsugu Kanemoto, 2000. "Global Warming and Transport Policies," CIRJE F-Series CIRJE-F-71, CIRJE, Faculty of Economics, University of Tokyo.
    6. Shirish Sangle, 2011. "Adoption of cleaner technology for climate proactivity: a technology–firm–stakeholder framework," Business Strategy and the Environment, Wiley Blackwell, vol. 20(6), pages 365-378, September.
    7. Fridstrøm, Lasse & Østli, Vegard, 2017. "The vehicle purchase tax as a climate policy instrument," Transportation Research Part A: Policy and Practice, Elsevier, vol. 96(C), pages 168-189.
    8. Alpizar, Francisco & Carlsson, Fredrik, 2003. "Policy implications and analysis of the determinants of travel mode choice: an application of choice experiments to metropolitan Costa Rica," Environment and Development Economics, Cambridge University Press, vol. 8(4), pages 603-619, October.

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