A Note on Environmental Policy Reform, Distortionary Taxation and Imperfect Competition

Thomas Aronsson (), Karl-Gustaf Löfgren () and Tomas Sjögren
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Thomas Aronsson: Department of Economics, Umeå University, Postal: S 901 87 Umeå, Sweden
Karl-Gustaf Löfgren: Department of Economics, Umeå University, Postal: S 901 87 Umeå, Sweden

No 600, Umeå Economic Studies from Umeå University, Department of Economics

Abstract: This paper concerns the welfare effects of public abatement projects, and concentrates on the influence of distortionary taxes and imperfect competition in the labor market. In addition to the direct environmental benefits and costs of resource use, abatement policies give rise to welfare effects via the tax system as well as via changes in the employment. We also show how the cost benefit rule is modified, if the other policy instrument are optimally chosen conditional on the level of abatement.

Keywords: Environmental policy; distortionary taxation; the labor market (search for similar items in EconPapers)
JEL-codes: H41 J51 J60 (search for similar items in EconPapers)
Pages: 9 pages
Date: 2002-12-17
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