Environmental Tax Reform, Economic Growth, and Unemployment in an OLG Economy

Ono, Tetsuo

doi:10.1628/001522107x186755

Cited by 7 publications

(1 citation statement)

References 23 publications

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“…Yet, most existing studies focus on either environmental tax reforms (e.g., Wendner (2001); Ono (2005Ono ( , 2007) or the introduction of a consumption tax (e.g., Hu (1996); Lopez-Garcia (1996) and Lin and Tian (2003)) as alternative financing instruments. In contrast, capital income taxation is generally not considered an alternative.…”

Section: Introductionmentioning

confidence: 99%

Financing social security by taxing capital income: A bad idea?

Kunze¹,

Schuppert²

2010

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The working papers published in the Series constitute work in progress circulated to stimulate discussion and critical comments. Views expressed represent exclusively the authors' own opinions and do not necessarily reflect those of the editors. Abstract This paper examines the growth effects of an increase of capital income taxes with additional revenue being devoted to cut wage-related social security contributions to reduce unemployment. The analysis is carried out in an overlapping generations model with endogenous growth, unemployment and a social security system comprising pensions and unemployment benefits. It is shown that the reform not only promotes employment but may additionally stimulate economic growth. Calibrating the model to match data for the EU15 reveals that European countries can indeed gain in form of higher employment and growth if the initial capital income tax is not too high. Terms of use: Documents inJEL Classification: H24, H55, O40

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Section: Introductionmentioning

confidence: 99%

Financing social security by taxing capital income: A bad idea?

Kunze¹,

Schuppert²

2010

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Environmental tax reform in an overlapping-generations economy with involuntary unemployment

Ono

2008

Environ Econ Policy Stud

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This report presents an overlapping-generations model in which (1) pollution is generated as a by-product of capital, and (2) employment is rationed by monopolistic trade unions. We consider an environmental tax reform, consisting of a labor tax cut and the introduction of an environmental tax, and investigate whether the reform attains improvements of employment, environmental quality, and the nonenvironmental utility of the employed and the unemployed. It is shown that the reform attains the improvements within a generation but fails to attain them across generations. The reform yields a trade-off between current and future generations in terms of nonenvironmental utility.

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From regressive pollution taxes to progressive environmental tax reforms

Chiroleu‐Assouline

Fodha

2014

European Economic Review

107

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International audienceEuropean countries have increased their use of environmental tax instruments by designing new tax bases. But many countries face opposition from public opinion, for fear of the distributive consequences of these environmental tax reforms. This paper sheds light on the distributive consequences of environmental tax policies when households are heterogeneous. The objective is to assess whether an environmental tax reform could be Pareto improving, when the revenue of the pollution tax is recycled by a change in labor tax properties. We show that, whatever the degree of regressivity of the environmental tax alone, it is possible to design a recycling mechanism that renders the tax reform more Pareto efficient, by simultaneously decreasing the wage tax and increasing its progressivity

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Environmental Tax Reform, Economic Growth, and Unemployment in an OLG Economy

Cited by 7 publications

References 23 publications

Financing social security by taxing capital income: A bad idea?

Financing social security by taxing capital income: A bad idea?

Environmental tax reform in an overlapping-generations economy with involuntary unemployment

From regressive pollution taxes to progressive environmental tax reforms

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