Location of Repository

Differentiation of Green Taxes: A Political-Economy Analysis for Germany

By Niels Anger, Christoph Böhringer and Andreas Lange

Abstract

In this paper we study political-economy determinants of the differentiation of environmental taxes between sectors. Using a common-agency model, we provide predictions on tax differentiation which are then tested using data from the German Ecological Tax Reform. As the reform is revenue neutral and reduces labor costs, tax differentiation is not only determined by the activity of lobby groups favoring reduced tax rates, but also by the groups? interest in revenue rebates to labor. Empirical data underpin our theoretical findings: A regression analysis of Germany?s green tax reform explains environmental tax differentiation by the presence of sectoral interest groups. Besides market concentration and energy demand elasticities, the exposure of industries to international trade flows plays an important role in the environmental tax design. --environmental tax reform,interest groups,common agency

OAI identifier:

Suggested articles

Preview

Citations

  1. (2000). A guide to extracting information from environmental pressure groups”,
  2. (1997). Carbon taxes with exemptions in an open economy: a general equilibrium analysis of the German tax initiative“,
  3. COMMISSION (2004a): Annexes to the fifteenth main report of the German Monopolies Commission 2002/2003.
  4. (2003). Die Ökologische Steuerreform in Deutschland: ein umweltpolitisches Feigenblatt“, Perspektiven der
  5. (2000). Effects of Differentiating Climate Policy by Sector: A U.S.
  6. (1980). Efficient rent seeking”
  7. (2003). Energy taxation: reasons for discriminating in favor of the production sector”,
  8. (1991). Environmental regulation in an open economy”,
  9. (2001). Environmentally related taxes in OECD countries: issues and strategies,
  10. (2002). In search of a rationale for differentiated environmental taxes”. ZEW Discussion Paper 02-30, Centre for European Economic Research,
  11. (1992). Lobbying and asymmetric information“,
  12. (1986). Menu auctions, resource allocation, and economic influence“, The quarterly journal of economics
  13. (1994). On Ecological Dumping”,
  14. (1997). On the political economy of green tax reforms”,
  15. (1996). Optimal taxation, public goods and environmental policy with involuntary unemployment“,
  16. (1998). Political internalization of economic externalities and environmental policy”,
  17. (1992). Probabilistic Voting Theory. Cambridge, Cambridge University Press.
  18. (1994). Protection for sale”,
  19. (2004). Sectoral Armington Elasticities in the European Community: Estimates and an Application to Environmental Fiscal Reform”, Working Paper,
  20. (1996). Should a carbon tax be differentiated across sectors?”,
  21. (2001). Special interest politics.
  22. (2004). The cost of sectoral differentiation of climate policy: The case of the EU emissions trading scheme”, Paper presented at the
  23. (1965). The logic of collective action. Cambridge,
  24. (2003). The Political Economy of Environmental Policy”
  25. (1997). The political economy of pollution taxes in a small open economy”,
  26. (1992). The Standard Welfare Economics of Policies Affecting Trade and the Environment”,

To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.