Designing Carbon Taxation Schemes for Automobiles: A Simulation Exercise for Germany

Sofronis Clerides, Adamos Adamou and Theodoros Zachariadis

No 8782, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Vehicle taxation based on CO2 emissions is increasingly being adopted worldwide in order to shift consumer purchases to low-carbon cars, yet little is known about the effectiveness and overall economic impact of these schemes. We focus on feebate schemes, which impose a fee on high-carbon vehicles and give a rebate to purchasers of low-carbon automobiles. We estimate a discrete choice model of demand for automobiles in Germany and simulate the impact of alternative feebate schemes on emissions, consumer welfare, public revenues and firm profits. The analysis shows that a well-designed scheme can lead to emission reductions without reducing overall welfare.

Keywords: Carbon taxation; Co2 emissions; Feebates; German automobile market (search for similar items in EconPapers)
JEL-codes: L92 Q52 Q58 (search for similar items in EconPapers)
Date: 2012-01
New Economics Papers: this item is included in nep-cmp, nep-ene, nep-env and nep-eur
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Citations: View citations in EconPapers (3)

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Related works:
Working Paper: Designing Carbon Taxation Schemes for Automobiles: A Simulation Exercise for Germany (2012)
Working Paper: Designing Carbon Taxation Schemes for Automobiles: A Simulation Exercise for Germany (2011)
Working Paper: Designing Carbon Taxation Schemes for Automobiles: A Simulation Exercise for Germany (2011)
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