Cost perceptions and the support for carbon pricing

Jan Behringer (), Lukas Endres () and Maike Korsinnek ()
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Jan Behringer: Macroeconomic Policy Institute (IMK)
Lukas Endres: Macroeconomic Policy Institute (IMK)
Maike Korsinnek: Macroeconomic Policy Institute (IMK)

No 226-2025, IMK Working Paper from IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute

Abstract: We examine how perceptions about the costs of carbon pricing affect policy acceptance. Using a representative sample of the German population, we conduct experiments that provide randomly selected respondents with personalized information about their costs at the current carbon price or a higher future price. Participants tend to overestimate their current costs and increase their carbon price acceptance when receiving cost information. In contrast, respondents underestimate future costs and reduce their support once they learn about actual costs. This underscores the importance of personalized information in fostering current support for carbon pricing, while cautioning against potential backlash as prices rise.

Keywords: Carbon pricing; policy acceptance; perceptions; experiment (search for similar items in EconPapers)
JEL-codes: D12 D83 H23 Q58 (search for similar items in EconPapers)
Pages: 68 pages
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:imk:wpaper:226-2025

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