On the Optimum Trend of Fossil Fuel Taxation

Peter Sinclair

Oxford Economic Papers, 1994, vol. 46, issue 0, 869-77

Abstract: The interest rate should fall with global warming. Remedial policy should allow for this endogeneity. In the simplest infinite-horizon model yielding a steady-state, one can derive the trend that an ad valorem fossil fuel tax should take to internalize the externality from emissions. It is negative. If implemented, it would reduce fossil fuel depletion and raise the rates of interest and growth to the values they would have had without global warming. The case for a falling fossil fuel tax is reinforced by the possibilities of future emission abatement and learning about the damage that emissions cause. Copyright 1994 by Royal Economic Society.

Date: 1994
References: Add references at CitEc
Citations: View citations in EconPapers (85)

Downloads: (external link)
http://links.jstor.org/sici?sici=0030-7653%2819941 ... 0.CO%3B2-N&origin=bc full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

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:oup:oxecpp:v:46:y:1994:i:0:p:869-77

Ordering information: This journal article can be ordered from
https://academic.oup.com/journals

Access Statistics for this article

Oxford Economic Papers is currently edited by James Forder and Francis J. Teal

More articles in Oxford Economic Papers from Oxford University Press Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK.
Bibliographic data for series maintained by Oxford University Press ().