IDEAS home Printed from https://ideas.repec.org/p/ssb/dispap/148.html
   My bibliography  Save this paper

Welfare Effects of Emission Taxes in Norway

Author

Listed:

Abstract

The welfare effects of introducing taxes on emissions of carbon dioxide is analysed within an empirical general equilibrium model of the Norwegian economy. A CO2 tax regime where we aim at stabilising the CO2 emissions at the 1990 emission level in 2020 is compared to a reference scenario without such taxes. In the simulations introduction of CO2 taxes reduces gross domestic product, but increases net national real disposable income, private consumption and money metric utility. This difference in sign is due to a positive terms of trade effect, some of the CO2 taxes will be paid by foreigners through exports. The welfare effects differ from household to household depending on the composition of their total consumption. Poor households are less favourably affected than rich households, due to smaller budget shares for the rich households on consumer goods which imply relatively much CO2 emissions.

Suggested Citation

  • Jørgen Aasness & Torstein Bye & Hans Terje Mysen, 1995. "Welfare Effects of Emission Taxes in Norway," Discussion Papers 148, Statistics Norway, Research Department.
    • Handle: RePEc:ssb:dispap:148
    as

    Download full text from publisher

    File URL: https://www.ssb.no/a/publikasjoner/pdf/DP/dp_148.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Jorgenson, Dale W. & Wilcoxen, Peter J., 1993. "Reducing U.S. carbon dioxide emissions: an assessment of different instruments," Journal of Policy Modeling, Elsevier, vol. 15(5-6), pages 491-520.
    2. Alan S. Manne & Richard G. Richels, 1991. "Global CO2 Emission Reductions -the Impacts of Rising Energy Costs," The Energy Journal, , vol. 12(1), pages 87-108, January.
    3. Clarete, Ramon L. & Whalley, John, 1987. "Comparing the marginal welfare costs of commodity and trade taxes," Journal of Public Economics, Elsevier, vol. 33(3), pages 357-362, August.
    4. D. W. Barns & J. A. Edmonds & J. M. Reilly, 1992. "Use of the Edmonds-Reilly Model to Model Energy-Related Greenhouse Gas Emissions," OECD Economics Department Working Papers 113, OECD Publishing.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Pizer, William A. & Kopp, Raymond, 2005. "Calculating the Costs of Environmental Regulation," Handbook of Environmental Economics, in: K. G. Mäler & J. R. Vincent (ed.), Handbook of Environmental Economics, edition 1, volume 3, chapter 25, pages 1307-1351, Elsevier.
    2. Turid Åvitsland & Jørgen Aasness, 2004. "Combining CGE and microsimulation models: Effects on equality of VAT reforms," Discussion Papers 392, Statistics Norway, Research Department.
    3. Jørgen Aasness & Odd Erik Nygård, 2009. "Revenue functions and Dupuit curves for indirect taxes with cross-border shopping," Discussion Papers 573, Statistics Norway, Research Department.
    4. Govinda R. Timilsina & Ram M. Shrestha, 2002. "General equilibrium analysis of economic and environmental effects of carbon tax in a developing country: case of Thailand," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 5(3), pages 179-211, September.
    5. Ahlrichs, Jakob & Rockstuhl, Sebastian & Tränkler, Timm & Wenninger, Simon, 2020. "The impact of political instruments on building energy retrofits: A risk-integrated thermal Energy Hub approach," Energy Policy, Elsevier, vol. 147(C).
    6. Fred Schroyen & Jørgen Aasness, 2006. "Marginal indirect tax reform analysis with merit good arguments and environmental concerns: Norway, 1999," Discussion Papers 455, Statistics Norway, Research Department.
    7. Lin, Boqiang & Li, Xuehui, 2011. "The effect of carbon tax on per capita CO2 emissions," Energy Policy, Elsevier, vol. 39(9), pages 5137-5146, September.
    8. Govinda Timilsina & Ram Shrestha, 2002. "General equilibrium analysis of economic and environmental effects of carbon tax in a developing country: case of Thailand," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 5(3), pages 179-211, September.
    9. Sverre Grepperud, 1997. "Soil Depletion Choices under Production and Price Uncertainty," Discussion Papers 186, Statistics Norway, Research Department.
    10. Paula Pereda & Andrea Lucchesi, Carolina Policarpo Garcia, Bruno Toni Palialol, 2019. "Neutral carbon tax and environmental targets in Brazil," Working Papers, Department of Economics 2019_02, University of São Paulo (FEA-USP).
    11. Bruvoll, Annegrete & Larsen, Bodil Merethe, 2004. "Greenhouse gas emissions in Norway: do carbon taxes work?," Energy Policy, Elsevier, vol. 32(4), pages 493-505, March.
    12. John K. Dagsvik & Zhiyang Jia, 2006. "Labor Supply as a Choice among Latent Job Opportunities. A Practical Empirical Approach," Discussion Papers 481, Statistics Norway, Research Department.
    13. Brita Bye & Snorre Kverndokk & Knut Rosendahl, 2002. "Mitigation costs, distributional effects, and ancillary benefits of carbon policies in the Nordic countries, the U.K., and Ireland," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 7(4), pages 339-366, December.
    14. Pezzey, John C.V., 2001. "Distributing the Value of a Country’s Tradeable Carbon Permits," 2001 Conference (45th), January 23-25, 2001, Adelaide, Australia 125832, Australian Agricultural and Resource Economics Society.
    15. Kverndokk,S. & Rosendahl,E., 2000. "CO2 mitigation costs and ancillary benefits in the Nordic countries, the UK and Ireland : a survey," Memorandum 34/2000, Oslo University, Department of Economics.
    16. Sodero, Stephanie, 2011. "Policy in motion: reassembling carbon pricing policy development in the personal transport sector in British Columbia," Journal of Transport Geography, Elsevier, vol. 19(6), pages 1474-1481.
    17. Turid Avitsland & Jorgen Aasness, 2006. "Combining microsimulation and CGE models: Effects on equality of VAT reforms," Computing in Economics and Finance 2006 132, Society for Computational Economics.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Bodil Larsen & Runa Nesbakken, 1997. "Norwegian emissions of CO 2 1987–1994," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 9(3), pages 275-290, April.
    2. Bruvoll, Annegrete & Larsen, Bodil Merethe, 2004. "Greenhouse gas emissions in Norway: do carbon taxes work?," Energy Policy, Elsevier, vol. 32(4), pages 493-505, March.
    3. Zhang, ZhongXiang & Baranzini, Andrea, 2004. "What do we know about carbon taxes? An inquiry into their impacts on competitiveness and distribution of income," Energy Policy, Elsevier, vol. 32(4), pages 507-518, March.
    4. Bhattacharyya, Subhes C., 1996. "Applied general equilibrium models for energy studies: a survey," Energy Economics, Elsevier, vol. 18(3), pages 145-164, July.
    5. Giraldo, Carlos & Giraldo, Iader & Gomez-Gonzalez, Jose E. & Uribe, Jorge M., 2024. "Climate Growth at Risk in the Global South," Documentos de trabajo 21166, FLAR.
    6. Konan, Denise Eby & Maskus, Keith E., 2000. "Joint trade liberalization and tax reform in a small open economy: the case of Egypt," Journal of Development Economics, Elsevier, vol. 61(2), pages 365-392, April.
    7. Robert Ayres, 1995. "Thermodynamics and process analysis for future economic scenarios," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 6(3), pages 207-230, October.
    8. Nordhaus, William, 2013. "Integrated Economic and Climate Modeling," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 1069-1131, Elsevier.
    9. Gerlagh, Reyer & Dellink, Rob & Hofkes, Marjan & Verbruggen, Harmen, 2002. "A measure of sustainable national income for the Netherlands," Ecological Economics, Elsevier, vol. 41(1), pages 157-174, April.
    10. Céline DE QUATREBARBES & Luc SAVARD & Dorothée BOCCANFUSO, 2011. "Can the removal of VAT Exemptions support the Poor? The Case of Niger," Working Papers 201106, CERDI.
    11. Chakravorty, Ujjayant & Magne, Bertrand & Moreaux, Michel, 2006. "A Hotelling model with a ceiling on the stock of pollution," Journal of Economic Dynamics and Control, Elsevier, vol. 30(12), pages 2875-2904, December.
    12. Celine de Quatrebarbes & Bertrand Laporte & Stéphane Calipel, 2021. "Fighting the soaring prices of agricultural food products. VAT versus Trade tariffs exemptions in a context of imperfect competition in Niger : CGE and micro-simulation approach," CERDI Working papers hal-03138369, HAL.
    13. Newell, Richard G. & Jaffe, Adam B. & Stavins, Robert N., 2006. "The effects of economic and policy incentives on carbon mitigation technologies," Energy Economics, Elsevier, vol. 28(5-6), pages 563-578, November.
    14. Glomm, Gerhard & Kawaguchi, Daiji & Sepulveda, Facundo, 2008. "Green taxes and double dividends in a dynamic economy," Journal of Policy Modeling, Elsevier, vol. 30(1), pages 19-32.
    15. Anwar Shah & Bjorn Larsen, 2014. "Carbon taxes, the greenhouse effect, and developing countries," Annals of Economics and Finance, Society for AEF, vol. 15(1), pages 353-402, May.
    16. Chakravorty, Ujjayant & Roumasset, James & Tse, Kinping, 1997. "Endogenous Substitution among Energy Resources and Global Warming," Journal of Political Economy, University of Chicago Press, vol. 105(6), pages 1201-1234, December.
    17. George J. Y. Hsu & Hong-Min Xu, 2000. "Impact of mitigating CO2 emissions on Taiwan’s economy: a fuzzy multiobjective programming approach," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 3(3), pages 335-345, September.
    18. Vlachou, Andriana & Vassos, Spyros & Andrikopoulos, Andreas, 1996. "Energy and environment: Reducing CO2 emissions from the electric power industry," Journal of Policy Modeling, Elsevier, vol. 18(4), pages 343-376, August.
    19. Conrad, Klaus, 1999. "An econometric model of production with endogenous improvement in energy efficiency, 1970-1995," Discussion Papers 563, Institut fuer Volkswirtschaftslehre und Statistik, Abteilung fuer Volkswirtschaftslehre.
    20. George Hsu & Hong-Min Xu, 2000. "Impact of mitigating CO 2 emissions on Taiwan’s economy: a fuzzy multiobjective programming approach," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 3(3), pages 335-345, September.

    More about this item

    Keywords

    CO2 taxes; general equilibrium model; money metric welfare; terms of trade;
    All these keywords.

    JEL classification:

    • E1 - Macroeconomics and Monetary Economics - - General Aggregative Models
    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ssb:dispap:148. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: L Maasø (email available below). General contact details of provider: https://edirc.repec.org/data/ssbgvno.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.