Can a Green Tax Reform Entail Employment Double Dividend in European and non-European Countries? A Survey of the Empirical Evidence
Maruf Maxim () and
Additional contact information
Kerstin Zander: Northern Institute, Charles Darwin University, Australia.
International Journal of Energy Economics and Policy, 2019, vol. 9, issue 3, 218-228
This paper synthesises the simulation studies concerning green tax reform (GTR) and employment double dividend (EDD) in European and non-European countries. The studies included investigate the effect of GTR on employment. We compared the simulation results between European and non-European countries to understand the impact of study region and our findings are fivefold. First, the simulation results suggest that GTR-driven EDD is observed in both European and non-European countries, but the average effect on employment in European countries (0.67%) is significantly greater than in non-European countries (0.18%). Second, optimal tax and tax revenue recycling policies in European and non-European countries for EDD are not identical. Reducing employers’ social security contributions (SSC) has the potential to generate EDD in both countries. However, a reduction in value added tax (VAT) has the highest average effect on employment in European countries (1.62%), which negatively affects employment in non-European countries (-0.02%). Third, a reduction in personal income tax (PIT) as a tax recycling method creates a marginally average employment dividend in non-European countries (0.16%) but is counterproductive in European countries (-0.15%). Fourth, other taxes, which predominantly represent mixed taxes, exhibit the highest EDD potential in both European (1.01%) and non-European (0.46%) countries. Finally, employment dividend diminishes over time, but a weak quadratic pattern has been observed that reveals an accelerating effect on employment in the long term. These reflections should be considered before employing GTR in non-European countries in order to yield EDD.
Keywords: Green tax reform; Double dividend; Employment (search for similar items in EconPapers)
JEL-codes: H23 H21 E24 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
Working Paper: Can a Green Tax Reform Entail Employment Double Dividend in European and non-European Countries? A Survey of the Empirical Evidence (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eco:journ2:2019-03-25
Access Statistics for this article
International Journal of Energy Economics and Policy is currently edited by Ilhan Ozturk
More articles in International Journal of Energy Economics and Policy from Econjournals
Bibliographic data for series maintained by Ilhan Ozturk ().