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Can Pigou at the Polls Stop Us Melting the Poles?

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Listed:
  • Soren T. Anderson
  • Ioana Marinescu
  • Boris Shor

Abstract

Surveys show majority U.S. support for a carbon tax. Yet none has been adopted. Why? We study two failed carbon tax initiatives in Washington State in 2016 and 2018. Using a difference-in-differences approach, we show that Washington's real-world campaigns reduced support by 20 percentage points. Resistance to higher energy prices explains opposition to these policies in the average precinct, while ideology explains 90% of the variation in votes across precincts. Conservatives preferred the 2016 revenue-neutral policy, while liberals preferred the 2018 green-spending policy. Yet we forecast both initiatives would fail in other states, demonstrating that surveys are overly optimistic.

Suggested Citation

  • Soren T. Anderson & Ioana Marinescu & Boris Shor, 2019. "Can Pigou at the Polls Stop Us Melting the Poles?," NBER Working Papers 26146, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:26146
    Note: EEE PE POL
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    References listed on IDEAS

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    1. Stefano Carattini & Andrea Baranzini & Philippe Thalmann & Frédéric Varone & Frank Vöhringer, 2017. "Green Taxes in a Post-Paris World: Are Millions of Nays Inevitable?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 68(1), pages 97-128, September.
    2. Jesse Burkhardt & Nathan W. Chan, 2017. "The Dollars and Sense of Ballot Propositions: Estimating Willingness to Pay for Public Goods Using Aggregate Voting Data," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 4(2), pages 479-503.
    3. Matthew J. Holian & Matthew E. Kahn, 2014. "Household Demand for Low Carbon Public Policies: Evidence from California," NBER Working Papers 19965, National Bureau of Economic Research, Inc.
    4. Matthew J. Holian & Matthew E. Kahn, 2015. "Household Demand for Low Carbon Policies: Evidence from California," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 2(2), pages 205-234.
    5. Stefano Carattini & Maria Carvalho & Sam Fankhauser, 2018. "Overcoming public resistance to carbon taxes," Wiley Interdisciplinary Reviews: Climate Change, John Wiley & Sons, vol. 9(5), September.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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