Economics at your fingertips  

Carbon taxes, industrial production, welfare and the environment

Presley K. Wesseh, Boqiang Lin () and Philip Atsagli

Energy, 2017, vol. 123, issue C, 305-313

Abstract: Conventional wisdom holds that, ignoring environmental benefits, carbon taxes should adversely affect low-income countries more than they should affect high-income regions. Simulating various ranges of optimal carbon taxes and testing their impacts, this study draws an opposite conclusion to the above assertion. However, when the model is adjusted to reflect benefits from environmental cleanup, carbon taxes create welfare gains in all regions except for low-income countries. In addition, implementing carbon taxes reduces environmental damages by approximately 50% in absolutely all the six regions considered. Notwithstanding the existence of a tradeoff between welfare and environment for low-income countries implies that energy conservation policies aimed at lowering greenhouse gas emissions would leave people worse-off in these countries.

Keywords: Optimal carbon pricing; Environmental externalities; Policy modeling; Welfare (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (6) Track citations by RSS feed

Downloads: (external link)
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Access Statistics for this article

Energy is currently edited by Henrik Lund and Mark J. Kaiser

More articles in Energy from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

Page updated 2018-11-10
Handle: RePEc:eee:energy:v:123:y:2017:i:c:p:305-313