nep-env New Economics Papers
on Environmental Economics
Issue of 2008‒01‒26
23 papers chosen by
Francisco S.Ramos
Federal University of Pernambuco

  1. Pollution Abatement in a Model of Capital Accumulation and Endogenous Longevity By Dimitrios Varvarigos
  2. A note on the consequences of an endogenous discounting depending on the environmental quality By Katheline Schubert; Alain Ayong Le Kama
  3. Trade, industrial location and environmental consciousness By Sotiris Karkalakos
  4. Dedicated Technical Progress with a Non-renewable Resource : Efficiency and Optimality By AMIGUES Jean-Pierre; MOREAUX Michel
  5. Explaining adoption of end of pipe solutions and clean technologies By Hammar, Henrik; Löfgren, Åsa
  6. Energy Efficiency and Renewable Energy Supply for the G-7 Countries, With Emphasis on Germany By Jon Strand
  7. Outcomes of a Swedish Kilometre Tax. An analysis of Economic Effects and Effects on NOx Emissions By Östblom, Göran; Hammar, Henrik
  8. Climate Change and Violent Conflict in Europe over the Last Millennium By Richard S.J. Tol; Sebastian Wagner
  9. Differences in Preferences Towards the Environment: The Impact of a Gender, Age and Parental Effect By Benno Torgler; María A.García-Valiñas; Alison Macintyre
  10. Symmetric and hierarchical fusion of expert opinion in the Transferable Belief Model, application on a climate sensivity dataset By Minh Ha-Duong
  11. Croissance durable : entre mythes et réalité By Patrick Criqui
  12. Optimal Resource Extraction Contracts Under Threat of Expropriation By Eduardo Engel; Ronald Fischer
  13. Inconsistency between a criterion and the initial conditions By Bazhanov, Andrei
  14. Retour sur la régulation des émissions azotées dans le bassin rhénan : une analyse descriptive à partir des informations de la base de données "Tradable Rhine" By Saulnier, J.
  15. Applicabilité des instruments de régulation pour la réduction des émissions azotées dans le bassin d'un cours d'eau By Saulnier, J.
  16. Instruments théoriques de régulation environnementale : au-delà de la substituabilité entre les instruments et de l'efficacité économique comme seul critère de choix ? By Saulnier, J.
  18. Deforestation, Growth and Agglomeration Effects: Evidence from Agriculture in the Brazilian Amazon By Ben Groom; Pauline Grosjean; Andreas Kontoleon; Tim Swanson; Shiqiu Zhang
  19. Patience, Fish Wars, rarity value & Allee effects. By R. Joosten
  20. Ressources renouvelables et incertitude sur les<br />préférences des générations futures By Katheline Schubert; Alain Ayong Le Kama
  21. The Drama of Fishing Commons: Cournot-Nash Model and Cooperation By José António Filipe
  22. Estimating the Future Economic Impact of Corn Ethanol Production in the U.S. By Swenson, David A.
  23. A Reconsideration of gDouble Dividendsh Hypothesis in Taxation on Externalities By SUMINO, Koh; YAMADA, Masatoshi

  1. By: Dimitrios Varvarigos
    Abstract: The effort to reduce pollution entails economic benefits because improved environmental quality advances the health status of the population and reduces mortality. Yet, there are also economic costs accruing from this effort because activities towards environmental improvement require resources to be extracted away from capital investment. This paper examines the extent to which pollution abatement policies may, ultimately, increase or decrease income. This is done in the context of a dynamic general equilibrium model, in which the interactions of the dynamics between capital accumulation and environmental quality occur through the flow of pollution generated by economic activity and the beneficial effect of environmental quality on longevity.
    Keywords: Pollution abatement; environmental quality; longevity; capital accumulation
    JEL: O13 O41 Q56
    Date: 2008–01
  2. By: Katheline Schubert (Ecole d'économie de Paris - Paris School of Economics - Université Panthéon-Sorbonne - Paris I, CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I); Alain Ayong Le Kama (Université de Lille - Université de Lille 1)
    Abstract: Our intention is to study, in the framework of a very simple optimal growth model, the consequences on the optimal paths followed by consumption and the environmental quality of an endogenous discounting. Consumption directly comes from the use of environmental services and so is a direct cause of environmental degradation. The environment is valued both as a source of consumption and as an amenity. For a sustainability concern, we introduce an endogenous discount rate growing with the environmental quality, and compare the optimal growth paths with the ones obtained in the usual case of exogenous and constant discounting. We show that the convergence of the environmental quality towards a steady state occurs only for a very special configuration of the parameters in the exogenous discounting case, while it occurs generically in the endogenous discounting one. This happens for a utility discount rate becoming suficiently high when the environmental quality is high and suficiently low when the environmental quality is poor. In this case then, endogenous discounting with a positive marginal discount rate allows us to avoid the depletion of the environment.
    Keywords: Endogenous discounting, Sustainability, Environment
    Date: 2007–04
  3. By: Sotiris Karkalakos (Economics, Keele University)
    Abstract: It is shown in the context of a new economic geography that, when capital is heterogeneous (a degree of environmental sensitivity), then trade liberalization may lead to industrial agglomeration and inter-regional trade. Capital heterogeneity gives local monopsony power to firms but also introduces variations in the quality of the match. Matches occur, under environmental consciousness assumption, giving rise to an agglomeration force, which can offset the forces against, trade costs and the erosion of monopsony power. A robust agglomeration equilibrium is derived analytically and shows that pollution can provide a motive for trade by spatially concentrated industries with environmental sensitivities.
    Keywords: Agglomeration; Pollution; Matching.
    JEL: F10 Q20 R12
    Date: 2007–11
  4. By: AMIGUES Jean-Pierre; MOREAUX Michel
    Date: 2008–01
  5. By: Hammar, Henrik (National Institute of Economic Research); Löfgren, Åsa (Department of Economics, Göteborg University, P.O. Box 640, SE 405 30 Göteborg)
    Abstract: We estimate firms’ probability of technological adoption based on an unbalanced firm level panel data set from four major sectors during the 2000-2003 period. Technological adoption is measured by environ-mental protection investments (EPIs), and we focus particularly on differences between the decisions to adopt end of pipe solutions and clean technology. We find that the probability of a firm to undertake investments in clean technologies to reduce emissions to air increases if the firm has expenditures for R&D related to environmental protec-tion (green R&D). We also find that firm specific energy expenditures contribute in explaining investments in end of pipe solutions, while this factor is not significant for investments in clean technologies. Furthermore, the results show that the two types of technologies are complements with respect to the investment decision, which indicates that policies that stimulate investments in one type of technology tend to affect investment in the other positively as well. In conclusion, pol-icy makers might want to contemplate environmental policy measures that stimulate green R&D in order to stimulate technological adoption.
    Date: 2007–10–01
  6. By: Jon Strand
    Abstract: This paper discusses structure, impact, costs, and efficiency of renewable energy supply in the eight largest advanced economies (the G-7 plus Spain), with focus on Germany. Renewables production costs are compared to benefits, defined as reductions in net carbon emissions; technological innovation, and increased energy security. The latter part of the paper centers on Germany, the main European producer of non-traditional renewables. We question whether the level of subsidies can be justified, relative to other means to increase energy security and reduce carbon emissions. We also find an excessive emphasis on current productive activity, relative to development of new technologies.
    Keywords: Energy , Group of seven , Germany , Spain , Energy policy , Energy taxes ,
    Date: 2008–01–02
  7. By: Östblom, Göran (National Institute of Economic Research); Hammar, Henrik (National Institute of Economic Research)
    Abstract: By using an applied general equilibrium model of the Swedish economy, this paper examines how an in-troduction of a kilometre tax will affect economic growth (GDP), industry structure and emission levels of nitrogen oxides (NOx). According to our findings, the GDP will decrease by 0.1-0.3 per cent and NOx emissions by 0.4-0.8 per cent (assuming fixed emissions coefficients) during the 2006-2020 period. Thus, we find that economic growth and NOx emissions decouple due to an introduction of a kilometre tax. The projected reductions of NOx emissions are, however, minor relative to the Swedish objective for 2010. Road transports will overall be substituted by sea and rail transports and industry structure will change in favour of industries less dependent on heavy road transports. The emissions reductions will, however, be substantively larger if the kilometre tax also ends up inducing technological development able to expedite the adoption of cleaner vehicles. Consequently, this would reinforce the decoupling effect. Furthermore, we compare our findings with the results of others, who used partial equilibrium or bottom-up approaches to study the effects of a Swedish kilometre tax. The effects on production are more signifi-cant in the applied general equilibrium framework, but structural changes point in the same direction for all the studies compared.
    Keywords: static general equilibrium model; EMEC; partial equilibrium model; bottom-up models; kilometre tax; transport policy; environmental policy
    JEL: C68 D20 H23 R48
    Date: 2007–12–15
  8. By: Richard S.J. Tol (Economic and Social Research Institute); Sebastian Wagner
    Abstract: We investigate the relationship between a thousand-year history of violent conflict in Europe and various reconstructions of temperature and precipitation. We find that conflict was more intense during colder periods. This relationship is weakening over time, and is not robust to the details of the climate reconstruction or to the sample period. We thus confirm Zhang et al. (2006, Climatic Change, 76, 459-477) that, at least in temperate climates, global warming would, if anything, lead to reduced violent conflict.
    Keywords: history, violent conflict, Europe, climate change
    JEL: N43 Q54
    Date: 2008–01
  9. By: Benno Torgler; María A.García-Valiñas; Alison Macintyre
    Abstract: The paper investigates empirically the differences in preferences towards protection of the environment. Using seven different dependent variables to focus on the impact of age, gender and children we use a large micro data set covering data from 33 Western and Eastern European countries. The results indicate that women have both a stronger preference towards the environment and a stronger willingness to contribute. Moreover, we observe the tendency of a negative correlation between age and environmental preferences. However, a positive effect is visible once we focus on the impact of age on social norms (environmental morale). Finally, we were not able to observe that having children is positively correlated with a stronger preference towards the environment.
    Keywords: environmental preferences; environmental morale; gender; age; children
    JEL: H26 H73 D64
    Date: 2007–12
  10. By: Minh Ha-Duong (CIRED - Centre international de recherche sur l'environnement et le développement - CIRAD : UMR56 - CNRS : UMR8568 - Ecole des Hautes Etudes en Sciences Sociales - Ecole Nationale des Ponts et Chaussées - Ecole Nationale du Génie Rural des Eaux et des Forêts)
    Abstract: This paper examines the fusion of conflicting and not independent expert opinion in the Transferable Belief Model. Regarding procedures that combine opinions symmetrically, when beliefs are bayesian the non-interactive disjunction works better than the non-interactive conjunction, cautious conjunction or Dempster's combination rule.<br /><br />Then a hierarchical fusion procedure based on the partition of experts into schools of thought is introduced, justified by the sociology of science concepts of epistemic communities and competing theories. Within groups, consonant beliefs are aggregated using the cautious conjunction operator, to pool together distinct streams of evidence without assuming that experts are independent. Across groups, the non-interactive disjunction is used, assuming that when several scientific theories compete, they can not be all true at the same time, but at least one will remain. This procedure balances points of view better than averaging: the number of experts holding a view is not essential.<br /><br />This is illustrated with a 16 experts real-world dataset on climate sensitivity from 1995. Climate sensitivity is a key parameter to assess the severity of the global warming issue. Comparing our findings with recent results suggests that, unfortunately, the plausibility that sensitivity is small (below 1.5C) has decreased since 1995, while the plausibility that it is above 4.5C remains high.
    Keywords: climate sensitivity; experts aggregation; Dempster-Shafer; Transferable Belief Model
    Date: 2006–11–07
  11. By: Patrick Criqui (LEPII - Laboratoire d'Économie de la Production et de l'Intégration Internationale - CNRS : UMR5252 - Université Pierre Mendès-France - Grenoble II)
    Abstract: La question de la durabilité de la croissance a mobilisé de nombreux économistes depuis le début des années soixante-dix. Elle renvoie aujourd’hui au découplage des émissions de gaz à effet de serre par rapport à la croissance économique. Les travaux du GIEC confirment que, pour maîtriser le changement climatique, il faudra ramener en 2050 les émissions mondiales de gaz à effet de serre bien en dessous des niveaux de 1990 et 2000, alors que la population aura augmenté de 50 % et que les projections économiques tablent sur une économie mondiale dont la taille aura été au moins multipliée par quatre.
    Date: 2008–01
  12. By: Eduardo Engel; Ronald Fischer
    Abstract: The government contracts with a foreign firm to extract a natural resource that requires an upfront investment and which faces price uncertainty. In states where profits are high, there is a likelihood of expropriation, which generates a social cost that increases with the expropriated value. In this environment, the planner's optimal contract avoids states with high probability of expropriation. The contract can be implemented via a competitive auction with reasonable informational requirements. The bidding variable is a cap on the present value of discounted revenues, and the firm with the lowest bid wins the contract. The basic framework is extended to incorporate government subsidies, unenforceable investment effort and political moral hazard, and the general thrust of the results described above is preserved.
    JEL: H21 H25 Q33 Q34 Q38
    Date: 2008–01
  13. By: Bazhanov, Andrei
    Abstract: What if an unsustainable economy decides to switch in finite time to a sustainable path of a nonrenewable resource extraction which is optimal with respect to some criterion? We consider this problem on the example of the Dasgupta-Heal-Solow-Stiglitz model (DHSS) using constant consumption over time as a criterion. It turns out that if the criterion has no connections with the "opportunities" of the economy (initial conditions) then the resulting "optimal" path of consumption can be inferior to the one along some sub-optimal sustainable paths of extraction calibrated on the original initial conditions. In our case we have obtained under the standard Hartwick Rule bounded and unbounded growth of consumption along these sub-optimal paths.
    Keywords: Essential nonrenewable resource; Sustainable extraction; Criterion inconsistency; Hartwick Rule
    JEL: Q32 Q38
    Date: 2008–01–02
  14. By: Saulnier, J.
    Abstract: La compréhension de la régulation des émissions azotées dans le bassin d’un cours d’eau nécessite d'avoir une bonne connaissance des milieux naturels concernés, des processus hydrologiques, du cadre institutionnel de régulation et des sources à l'origine des émissions. L’objectif de cet article est donc de décrire l’ensemble de ces éléments pour le bassin rhénan. Nous utilisons pour cela les informations de la base de données "Tradable_Rhine" qui regroupe des données depuis 1974 sur les différentes régions du bassin. Dans un premier temps nous dressons un portrait du bassin rhénan du point de vue de ses principales caractéristiques physiques et géopolitiques. Puis nous revenons sur la façon dont la ressource en eau du bassin a été gérée au cours du temps. Les voies d’apport d’émissions azotées dans les eaux et les responsabilités relatives de chaque secteur sont notamment présentées. Les techniques de production et l’évolution des facteurs contribuant au rejet d’émissions par les différents types de sources sont également analysées. Les résultats montrent que le secteur agricole joue désormais un rôle prépondérant dans les rejets d’émissions azotées. Cela s'explique principalement selon nous par l'utilisation plus intensive d'engrais azotés et par la concentration croissante des exploitations d’élevage qui contribue à la production et l'épandage de plus grandes quantités de lisiers. Dans l’industrie, nous constatons en outre que l’introduction de techniques d’épuration avancées a contribué à réduire significativement la part de ce secteur dans les émissions. La modernisation dans l’épuration des eaux résiduaires urbaines a quant à elle été plus tardive et moins importante. La réduction des émissions azotées dans ce secteur est donc, jusque là, restée plus modérée dans ce secteur que dans l’industrie.
    JEL: C80 Q00 R52
    Date: 2007
  15. By: Saulnier, J.
    Abstract: L'analyse du cadre institutionnel existant et des paramètres physiques et naturels qui peuvent influer sur la régulation des émissions azotées dans les eaux de surface est essentielle pour juger de l’efficacité des instruments. Cela nous a amené à retenir un modèle de régulation qui rend compte de manière plus fidèle des contraintes auxquelles est confronté le régulateur. Dans ce cadre, nous concluons que loin de se concurrencer, les instruments de régulation existants vont plutôt devoir être utilisés en combinaison pour plus d’efficacité. Plus spécifiquement, l'imposition de plafonds d'émission tant que les objectifs correspondant aux valeurs maximales autorisées ne sont pas respectés, combinés à un système de permis, ou de taxe-subvention, apparait comme le compromis le plus efficace et le plus vraisemblable en terme d'acceptabilité. Dans la réalité, ces deux instruments sont d'ailleurs ceux qui ont été utilisés lorsque il s'est agit de prendre plus en compte l'efficacité économique dans les systèmes de régulation. Une revue des expériences montre néanmoins que leur application n'a pas été aussi efficace que ce que la théorie laissait espérer. C'est particulièrement vrai dans le cas de la gestion de la ressource en eau avec les systèmes de taxe-subvention en Europe avant tout perçus comme une source de financement et avec les systèmes de permis aux États-Unis dont la plupart sont un simple prolongement du cadre réglementaire existant.
    JEL: Q50 H23 Q58
    Date: 2007
  16. By: Saulnier, J.
    Abstract: Le recours aux instruments économiques de régulation environnementale est désormais largement mis en avant comme un moyen de corriger les effets négatifs d’externalités telles que le rejet d’émissions polluantes. Les travaux récents sur la question du choix entre les instruments font toutefois apparaitre que la combinaison des instruments peut être un moyen de corriger certains problèmes généralement associés au recours à un seul type d’instrument. En outre, certaines études mettent en avant le contexte dans lequel se déroule la régulation comme un facteur limitant à la pleine réalisation de l’efficacité théorique potentielle de chaque instrument. Dans cet article, nous revenons sur ces questions en analysant, dans un cadre d’équilibre partiel, les propriétés d’efficacité théoriques des instruments de régulation que sont la norme, la taxe, la subvention, et les permis négociables. D’une part, nous confirmons que la combinaison des instruments est bien un moyen efficace de parvenir à la réduction des émissions souhaitée et qu’elle réduit le risque d’erreur du régulateur, celui-ci ayant plusieurs leviers à sa disposition pour éventuellement corriger son action. D’autre part, l’abandon progressif des hypothèses du cadre strict du modèle de régulation à l’optimum nous amène à considérer des critères additionnels de choix entre les instruments. Nous constatons notamment que le régulateur est contraint de composer avec les intérêts le plus souvent contradictoires des agents. Nous concluons, confirmant en cela les résultats existants dans la littérature, que, au-delà des seuls critères théoriques d’efficacité économique et environnementale, la comparaison entre différents instruments nécessite pour être conclue, d’intégrer le contexte empirique de leur déploiement.
    JEL: Q50 H23 Q58
    Date: 2007
  17. By: Allan W. GRAY Author-X-Name-First:Allan; Michael D. BOEHLJE (Department of Agricultural Economics, College of Agriculture, Purdue University)
    Abstract: Farming is in the midst of a major transformation—not only in technology and production practices, but also in size of business, resource (land) control and operation, business model and linkages with buyers and suppliers. This paper describes the fundamental drivers of today’s structural change in U.S. agriculture. The impact of the drivers are illustrated by describing some illustrations of the kinds of innovative farming operations that are developing in agriculture, not the typical farms but those who appear to be leading and shaping the new agriculture. Finally, farm policy implications of the transformation of farming to an industrial manufacturing model are discussed.
    Keywords: Farm policy, industrialization of agriculture, structural change, biological manufacturing
    JEL: Q18
    Date: 2007
  18. By: Ben Groom (Department of Economics, School of Oriental and African Studies, Thornhaugh St, Russell Square, London WC1H 0XG); Pauline Grosjean; Andreas Kontoleon; Tim Swanson; Shiqiu Zhang
    Abstract: The link between local institutional and market failures, rural poverty and environmental degradation suggests a win-win policy intervention: solve local ?constraints and achieve both poverty alleviation and environmental goals. However, designing such interventions is problematic since exposure to constraints is unobservable and responses can be heterogeneous. In this context we evaluate the ability of the world's largest land set-aside programme, the Sloping Lands Conversion Programme (SLCP) in China, to relax local constraints on off-farm labour markets and achieve these dual objectives. A farm household model in the presence of constraints is developed. This identi?es constrained and unconstrained households and predicts that the impact of the SLCP on off-farm labour supply will be larger for the former if constraints are relaxed. To test this, a novel empirical approach is employed which combines a switching regression with difference in differences. Applied to panel data, these features allow unobserved sample separation, into constrained and unconstrained households, and consistent estimation of the SLCP?s heterogeneous impact. Also identified is the impact on the probability of being constrained and the relative importance of constraints such as tenure security. We ?nd some mixed support for the win-win hypothesis in the case of the SLCP.
    Keywords: Off-farm labour supply, institutional and market failures, local separability, Sloping Lands Conversion Programme (SLCP), difference in differences, switching regression
    JEL: C33 J22 O22
    Date: 2008
  19. By: R. Joosten
    Abstract: In a Small Fish War two agents interacting on a body of water have essentially two options: they can Â…fish with restraint or without. Fishing with restraint is not harmful; Â…shing without yields a higher immediate catch, but may induce lower future catches. Inspired by recent work in biology, we introduce into this setting rarity value and Allee effects. Rarity value means that extreme scarcity of the Â…sh may affect its unit proÂ…t 'explosively'. An Allee effect implies that if the population size or density falls below a so-called Allee threshold, then only negative growth rates can occur from then on. We examine equilibrium behavior of the agents under the limiting average reward criterion and the sustainability of the common-pool resource system. Assuming Â…fixed prices at fiÂ…rst, we show that patience on the part of the agents is beneÂ…cial to both sustainable high catches and Â…fish stocks. An Allee effect can not influence the set of equilibrium rewards unless the Allee threshold is (unrealistically) high. A price mechanism reflecting effects of the resource's scarcity, is then imposed. We obtain a rather subtle picture of what may occur. Patience may be detrimental to the sustainability of a high Â…fish stock and it may be compatible with equilibrium behavior to exhaust the resource almost completely. However, this result does not hold in general but it depends on complex relations between the Allee threshold, the dynamics in the (interactive) resource and price systems, and the actual scarcity caused if the agents show no restraint.
    Keywords: common pool resource systems, Â…fish wars, limiting average rewards, sustainability, rarity value, Allee effect, stochastic games Length 19 pages
    Date: 2007–12
  20. By: Katheline Schubert (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I); Alain Ayong Le Kama (Université de Lille - Université de Lille 1)
    Abstract: Rien ne nous permet d'être certains que les générations futures auront les mêmes préférences que nous concernant les biens environnementaux. En outre, même si nous sommes tentés, en raison de la dégradation de la qualité de l'environnement, de croire que leur sensibilité à l'environnement sera plus grande que la notre, rien ne nous permet de l'affirmer avec certitude. Cet article étudie alors, dans un cadre très simple, les conséquences en termes de trajectoires optimales de consommation<br />d'une incertitude sur les préférences des générations futures en matière de consommation d'une ressource environnementale renouvelable. Une telle incertitude va-t-elle induire un comportement optimal plus "conservateur" vis-à-vis de la ressource ? Nous montrons que tel est le cas uniquement si nous anticipons aujourd'hui que les générations futures seront en moyenne plus sensibles que nous ne le sommes à la consommation permise par l'utilisation de la ressource environnementale. Nous montrons en outre que la prise en compte de cette incertitude conduit à une profonde modification de la trajectoire optimale de consommation, qui non seulement<br />devient non-continue mais en outre peut devenir non-monotone.
    Keywords: ressources renouvelables, croissance, préférences, incertitude
    Date: 2006–03
  21. By: José António Filipe
    Keywords: Cournot-Nash model; drama of the commons; cooperation; game theory; fishing effort.
    Date: 2007
  22. By: Swenson, David A.
    Abstract: This brief exercise assesses the potential economic impact value of ethanol production comparing current, 2007, estimates with a future level of production for 2016 and a long run equilibrium level (LRE) for 2025. The values for this estimate are driven by current Food and Agricultural Policy Research Institute (FAPRI) forecasts of corn and ethanol production. All of the estimates assume corn ethanol production only. No other kind of ethanol production is measured nor should be implied. By 2016, nearly 9,000 U.S. jobs will be directly linked to ethanol production, supporting in total nearly 47,200 jobs in the whole economy, given the assumptions in the analysis.
    JEL: L6
    Date: 2008–01–18
  23. By: SUMINO, Koh (Department of Economics, Otaru University of Commerce); YAMADA, Masatoshi (Graduate School of Economics, Osaka University)
    Abstract: Bovenberg and Mooij (1994) and others pointed out that the optimal taxation on goods with external diseconomy both collects revenue and also corrects the external diseconomy by the goods, and thus it is said that the tax has gdouble dividendsh. The purpose of the present paper is to examine whether the double-dividend arguments by Bovenberg and Mooij and others are appropriate when they are viewed from the traditional arguments of optimal and corrective (Pigovian) taxation. Based on their framework, we show that it should be evaluated differently from Bovenberg and Mooij whether double-dividend hypothesis holds or not, and that the hypothesis usually holds if it is appropriately defined.
    Keywords: Optimal tax rule, external diseconomies, double-dividend hypothesis
    JEL: D62 H23
    Date: 2008–01

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