How to Increase Public Support for Carbon Pricing

Andrej Woerner, Taisuke Imai, Davide Pace and Klaus Schmidt
Additional contact information
Andrej Woerner: LMU Munich
Taisuke Imai: University of Osaka
Davide Pace: LMU Munich
Klaus Schmidt: LMU Munich

No 489, Rationality and Competition Discussion Paper Series from CRC TRR 190 Rationality and Competition

Abstract: The public acceptability of a carbon price depends on how the revenues from carbon pricing are used. In a fully incentivised experiment with a large representative sample of the German population, we compare five different revenue recycling schemes and show that support for a carbon price is maximised by a “Climate Premium” that pays a fixed, uniform, upfront payment to each person. This recycling scheme receives more support than tax and dividend schemes, than using revenues for the general budget of the government, and than earmarking revenues for environmental projects. Furthermore, we show that participants and experts underestimate the public support for carbon pricing.

Keywords: carbon pricing; pigovian taxation; political support for carbon taxes; survey experiments (search for similar items in EconPapers)
JEL-codes: C9 D9 H23 P18 (search for similar items in EconPapers)
Date: 2023-12-21
New Economics Papers: this item is included in nep-ene, nep-env and nep-pub
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:rco:dpaper:489

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