Geography versus income: the heterogeneous effects of carbon taxation - HAL-SHS - Sciences de l'Homme et de la Société
Pré-Publication, Document De Travail (Working Paper) Année : 2024

Geography versus income: the heterogeneous effects of carbon taxation

Résumé

Distributive effects of carbon taxation are key for its political acceptability. We introduce geographical heterogeneity into a calibrated dynamic general equilibrium heterogeneous-agent model, where energy is both a consumption good and an intermediate input. We evaluate the aggregate and distributive effects of carbon taxation and obtain three key results. First, the distributive effects of carbon taxation are driven by geography more than income, with rural households suffering larger welfare losses. Second, taxing households’ direct emissions is regressive, while taxing firms’ direct emissions is progressive. Third, we simulate various revenue-recycling policies using targeted transfers. We find that it is possible to reduce emissions and mitigate welfare losses associated with the green transition.
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Dates et versions

halshs-04464900 , version 1 (19-02-2024)
halshs-04464900 , version 2 (16-05-2024)

Identifiants

  • HAL Id : halshs-04464900 , version 2

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Charles Labrousse, Yann Perdereau. Geography versus income: the heterogeneous effects of carbon taxation. 2024. ⟨halshs-04464900v2⟩
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