A green reform is not always green

Mogens Fosgerau and Thomas C. Jensen

MPRA Paper from University Library of Munich, Germany

Abstract: This paper analyses a tax reform, explicitly conceived by policy makers to be climate-friendly, that partly replaces a high vehicle registration tax by road user charging and allows for differentiation of the remaining registration tax by fuel efficiency. A microeconomic framework is proposed to analyse such a reform. For the case of Denmark, the analysis shows that the reform is likely to yield a significant and robust welfare gain. However, it seems not unlikely that CO2 emissions from passenger cars may increase as a result of the reform.

Keywords: Congestion; Road user charging; Tax reform; CO2; Welfare economics; Registration tax (search for similar items in EconPapers)
JEL-codes: H2 R41 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-acc, nep-ene, nep-env, nep-res and nep-tre
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:42264

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