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The French Tax on Air Pollution: Some Preliminary Results on its Effectiveness


  • Katrin Millock


  • Céline Nauges

    (LEERNA, INRA-Toulouse)


Empirical evidence evaluating the efficiency of economic instruments is still rare, despite significant theoretical advances over the last decades. The objective of this paper is to evaluate one form of environmental taxation, the French tax on air pollution from 1990-99. While starting out in 1985 as a tax levied only on emissions of sulphur dioxide (SO2 ), the tax base was subsequently extended to encompass also emissions of nitrogen oxides (NOx), hydrochloric acid (HCl), and volatile organic compounds (VOC). The revenues of the French tax on air pollution were earmarked for abatement subsidies and the financing of air quality surveillance systems. Using a plant-level database, we find a negative, significant effect of the tax on emissions of SO2, NOx, and HCl. The abatement elasticity with regard to the tax is quite small, however.

Suggested Citation

  • Katrin Millock & Céline Nauges, 2003. "The French Tax on Air Pollution: Some Preliminary Results on its Effectiveness," Working Papers 2003.44, Fondazione Eni Enrico Mattei.
  • Handle: RePEc:fem:femwpa:2003.44

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    References listed on IDEAS

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    Cited by:

    1. N. Riedinger & E. Hauvy, 2003. "The cost of air pollution abatement for French firms: An estimation at the firm-level," Documents de Travail de la DESE - Working Papers of the DESE g2003-01, Institut National de la Statistique et des Etudes Economiques, DESE.
    2. Zaida Contreras, Tihomir Ancev, and Regina Betz, 2014. "Evaluation of Environmental Taxation on Multiple Air Pollutants in the Electricity Generation Sector - Evidence from New South Wales, Australia," Economics of Energy & Environmental Policy, International Association for Energy Economics, vol. 0(Number 2).
    3. Katrin Millock & Céline Nauges & Thomas Sterner, 2004. "Environmental Taxes: A Comparison of French and Swedish Experience from Taxes on Industrial Air Pollution," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 2(1), pages 30-34, 04.
    4. Nicolas Riedinger & Erwan Hauvuy, 2005. "Une estimation du coût dabattement de la pollution atmosphérique pour les entreprises françaises," Économie et Prévision, Programme National Persée, vol. 168(2), pages 63-75.

    More about this item


    Environmental tax; emissions regulation; earmarking; air quality;

    JEL classification:

    • H00 - Public Economics - - General - - - General
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy

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