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International Cooperation over Green Taxes: On the Impossibility of Achieving a Probability-One Gain

Author

Listed:
  • Aronsson, Thomas

    () (Department of Economics, Umeå University)

  • Backlund, Kenneth

    () (Department of Economics, Umeå University)

  • Löfgren, Karl-Gustaf

    () (Department of Economics, Umeå University)

Abstract

This paper concerns international coordination of environmental taxation. The main purpose is to study the global welfare effects that will arise, if there is an agreement between countries to slightly increase their emission taxes. We show that even if each individual country has chosen its prereform emission tax to be 'too low' in comparison with the marginal cost of the environmental damage caused by that particular country's emissions, implementation of the agreement will not necessarily increase the welfare level.

Suggested Citation

  • Aronsson, Thomas & Backlund, Kenneth & Löfgren, Karl-Gustaf, 2000. "International Cooperation over Green Taxes: On the Impossibility of Achieving a Probability-One Gain," Umeå Economic Studies 522, Umeå University, Department of Economics.
  • Handle: RePEc:hhs:umnees:0522
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    Cited by:

    1. Aronsson, Thomas & Blomquist, Soren, 2003. "Optimal taxation, global externalities and labor mobility," Journal of Public Economics, Elsevier, vol. 87(12), pages 2749-2764, December.

    More about this item

    Keywords

    Environmental taxation; global external effects;

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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