Template-Type: ReDIF-Article 1.0
Author-Name:  Brita Bye 
Author-Name:  Karine Nyborg
Title:  Are Differentiated Carbon Taxes Inefficient?  A General Equilibrium Analysis
Classification-JEL: F0
Pages:  95-112
Volume:  Volume24
Issue:  Number 2
Year:  2003
Abstract:  Revenue-raising environmental policy instruments, such as carbon taxes, tend to be politically controversial. In practice, carbon taxes are often differentiated between polluters, implying unequal marginal abatement costs. Grandfathered tradeable permits seem less controversial; this instrument yields equal marginal abatement costs, but does not raise revenue. We compare a system of differentiated carbon taxes, exemplified by the current Norwegian carbon tax regime, to uniform carbon taxation and grandfathered tradeable emission permits. In this particular case, differentiated taxes are welfare superior to grandfathered permits. Nevertheless, uniform carbon taxes outperform both. 
Handle: RePEc:aen:journl:2003v24-02-a04
File-URL: http://www.iaee.org/en/publications/ejarticle.aspx?id=1408
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