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Legislative Organization and Pollution Taxation

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  • Per Fredriksson

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  • Daniel Millimet

Abstract

The role of political institutions in shaping public policy has been analyzed in isolation from corruption, and legislative organization (specifically, bicameralism) has received minimal attention. We analyze pollution taxation when decisions are influenced by several veto players, such as legislative chambers. Our theory predicts that an increase in the number of veto players (e.g., moving from uni- to bi-cameralism) pushes the pollution tax towards the social optimum, with the effect being conditional on corruption. As such, dispersion around the optimal tax is lower under bicameralism. Empirical tests – using data from 86 countries – support the theory. Copyright Springer Science+Business Media, LLC 2007

Suggested Citation

  • Per Fredriksson & Daniel Millimet, 2007. "Legislative Organization and Pollution Taxation," Public Choice, Springer, vol. 131(1), pages 217-242, April.
  • Handle: RePEc:kap:pubcho:v:131:y:2007:i:1:p:217-242
    DOI: 10.1007/s11127-006-9114-0
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    References listed on IDEAS

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    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Ensthaler, Ludwig & Huck, Steffen & Leutgeb, Johannes, 2016. "Games played through agents in the laboratory: A test of Prat & Rustichini's model," Discussion Papers, Research Unit: Economics of Change SP II 2016-305, Social Science Research Center Berlin (WZB).
    2. Dasgupta, Shouro & De Cian, Enrica, 2016. "Institutions and the Environment: Existing Evidence and Future Directions," MITP: Mitigation, Innovation,and Transformation Pathways 240747, Fondazione Eni Enrico Mattei (FEEM).
    3. Per G. Fredriksson & Jim R. Wollscheid, 2014. "Political Institutions, Political Careers and Environmental Policy," Kyklos, Wiley Blackwell, vol. 67(1), pages 54-73, February.
    4. Cole, Matthew A. & Fredriksson, Per G., 2009. "Institutionalized pollution havens," Ecological Economics, Elsevier, vol. 68(4), pages 1239-1256, February.
    5. Esteban Colla De Robertis, 2010. "Monetary Committee Size and Special Interest Influence," Documentos de Investigación - Research Papers 2, Centro de Estudios Monetarios Latinoamericanos, CEMLA.
    6. Stefanie Bailer & Florian Weiler, 2015. "A political economy of positions in climate change negotiations: Economic, structural, domestic, and strategic explanations," The Review of International Organizations, Springer, vol. 10(1), pages 43-66, March.
    7. Toke Aidt & Uk Hwang, 2014. "To Ban or Not to Ban: Foreign Lobbying and Cross National Externalities," Cambridge Working Papers in Economics 1402, Faculty of Economics, University of Cambridge.
    8. Persson, Lars, 2012. "Environmental policy and lobbying in small open economies," Resource and Energy Economics, Elsevier, vol. 34(1), pages 24-35.
    9. Aidt, T.S. & Hwang, U., 2008. "One Cheer for Foreign Lobbying," Cambridge Working Papers in Economics 0860, Faculty of Economics, University of Cambridge.

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