Carbon Pricing, Carbon Dividends and Cooperation: Experimental Evidence

Sebastian Bachler, Sarah Lynn Flecke, Jürgen Huber, Michael Kirchler and Rene Schwaiger

Journal of Economic Behavior & Organization, 2024, vol. 225, issue C, 37-50

Abstract: We investigated whether carbon taxes with and without carbon dividends improve cooperative behavior to mitigate simulated climate change. We implemented a randomized controlled trial on a large sample of the U.S. general population (N=2,116). Played in real-time in groups of four, we tested three carbon-pricing treatments and a baseline condition within a modified threshold public goods game of loss avoidance. We found that a carbon tax coupled with carbon dividends reduces carbon-emitting group consumption relative to a baseline condition with no tax, and relative to a carbon tax only. A carbon tax coupled with carbon dividends paid out to below-average polluters (asymmetric dividend) worked best, with 94% of groups remaining below a critical consumption (emission) threshold. We also found that experiencing the asymmetric dividend condition positively affected perceptions of carbon pricing with carbon dividends.

Keywords: Climate change; Carbon pricing; Carbon tax; Carbon dividend; Revenue recycling; Cooperation (search for similar items in EconPapers)
JEL-codes: C92 H23 H30 H41 Q54 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0167268124002634
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: https://EconPapers.repec.org/RePEc:eee:jeborg:v:225:y:2024:i:c:p:37-50

DOI: 10.1016/j.jebo.2024.07.004

Access Statistics for this article

Journal of Economic Behavior & Organization is currently edited by Houser, D. and Puzzello, D.

More articles in Journal of Economic Behavior & Organization from Elsevier
Bibliographic data for series maintained by Catherine Liu ().