Efficiency and equity aspects of energy taxation

Toon Vandyck ()

No EM12/13, EUROMOD Working Papers from EUROMOD at the Institute for Social and Economic Research

Abstract: We analyse the distributional effects of increased oil excises in Belgium by combining aComputable General Equilibrium (CGE) model with the EUROMOD microsimulation frameworkthat exploits the rich detail of household-level data. The link between the CGE model and themicro level is top-down, feeding changes in commodity prices, factor returns and employment bysector into a non-behavioural microsimulation. The results suggest that policymakers face anequity-efficiency trade-off driven by the choice of revenue recycling options. Distributional effectsof the environmental tax reform appear to depend strongly on changes in factor prices and welfarepayments.

Date: 2013-07-30
New Economics Papers: this item is included in nep-cmp, nep-cwa, nep-ene, nep-env and nep-pbe
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Citations: View citations in EconPapers (2)

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