Journal of Economic Literature
ISSN 0022-0515 (Print) | ISSN 2328-8175 (Online)
Carbon Taxes
Journal of Economic Literature
(pp. 1456–1502)
Abstract
There is a growing interest in using carbon taxes to reduce greenhouse gas emissions, not only in industrialized economies but also in developing economies. Many countries have considered carbon pricing, including carbon taxes, as policy instruments to meet their emission reduction targets set under the Paris Climate Agreement. However, policy makers, particularly from developing countries, are seeking clarity on several issues鈥攑articularly the impacts of carbon taxes on the economy, the distribution of these impacts across households, carbon tax design architectures, the effects of carbon taxes on the competitiveness of carbon-intensive industries, and comparison of carbon taxes with other policy instruments for climate change mitigation. This paper aims to offer insights on these issues by synthesizing the literature available since the 1970s, when the concept of carbon tax was first introduced. This paper also identifies the areas where further investigations are needed.Citation
Timilsina, Govinda R. 2022. "Carbon Taxes." Journal of Economic Literature 60 (4): 1456–1502. DOI: 10.1257/jel.20211560Additional Materials
JEL Classification
- H23 Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
- Q35 Hydrocarbon Resources
- Q38 Nonrenewable Resources and Conservation: Government Policy
- Q54 Climate; Natural Disasters and Their Management; Global Warming
- Q58 Environmental Economics: Government Policy