Fiscal and Budgetary Policy Efforts towards Climate Change Mitigation in Romania

Nicoleta Mihaela Florea, Georgeta-Madalina Meghisan-Toma (), Silvia Puiu, Flaviu Meghisan, Marius Dalian Doran and Mariana Niculescu
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Nicoleta Mihaela Florea: Department of Finance, Banking and Economic Analysis, Faculty of Economics and Business Administration, University of Craiova, 13 A.I. Cuza Street, 200585 Craiova, Romania
Flaviu Meghisan: Department of Management and Business Administration, Faculty of Economics and Law, University of Pitesti, 71 Republicii Street, 110014 Pitesti, Romania
Marius Dalian Doran: Doctoral School of Economic Sciences, Faculty of Economics and Business Administration, University of Craiova, 13 A.I. Cuza Street, 200585 Craiova, Romania
Mariana Niculescu: Department of Agricultural and Forestry Technologies, Faculty of Agriculture, University of Craiova, 13 A.I. Cuza Street, 200585 Craiova, Romania

Sustainability, 2021, vol. 13, issue 5, 1-18

Abstract: To mitigate the negative effects of climate change on the environment, the Member States of the European Union implement fiscal measures and commit budgetary expenditures to ensure sustainable economic development. Romania, in line with the Union’s objectives, resorted to the application of a system of environmental taxes and provided in the budgetary policy government expenditures for environmental protection. The aim of the research is to highlight the effects of these measures on the environment by analysing the short-run and long-run causal relationships between greenhouse gas emissions, green taxes and government expenditures on environmental protection. Autoregressive Distributed Lag (ARDL) method and Granger causality tests were used to demonstrate the existence of these relationships and the intensity with which they manifest. Following the analysis, we identified a significant long-run influence of government spending on environmental protection on greenhouse gas emissions but also numerous short-run and long-run causal relationships between greenhouse gas emissions and green taxes, applied in Romania. The results of the research consider the impact of public expenses for environment protection, a variable not yet applied for Romania, on greenhouse gas emissions’ decrease, in correlation with environmental taxes per source of origin.

Keywords: greenhouse gas emissions; climate change mitigation; green taxation; environmental taxation; climate action (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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