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The Double Dividend Hypothesis in a CGE Model: Specific Factors and Variable Labour Supply

Iain Fraser () and Robert Waschik ()

Studies in Economics from School of Economics, University of Kent

Abstract: Employing a CGE model we examine the Double Dividend (DD) hypothesis for Australia and UK. Following Bento and Jacobsen (2007), we analyze specific factors in the production of energy goods and the impact on the DD. By incorporating endogenous labour supply we examine the labour market effect of targeted abatement policies. For Australia the DD is significantly larger with the specific factor characterisation of the economy when recycling revenue through reductions in consumption taxes, but there is no evidence of a DD when employing income tax. We find minimal evidence of a DD for UK for either recycling instrument.

Keywords: Environmental Taxes; Double Dividend; Specific Factors. (search for similar items in EconPapers)
JEL-codes: Q52 Q48 C68 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ene and nep-env
Date: 2010-04
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Working Paper: The Double Dividend Hypothesis in a CGE Model: Specific Factors and Variable Labour Supply* (2010) Downloads
Working Paper: The Double Dividend Hypothesis in a CGE Model: Specific Factors and Variable Labour Supply* (2010) Downloads
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