Investigating the effects of environmental taxes on economic growth: Evidence from empirical analysis in European countries
This paper empirically analyze the effects of environmental taxes on economic growth using data spanning the period 2009–2019 across 31 European countries (28 from the European Union, including the UK before Brexit, Iceland and Norway, which are candidates to join the EU, and Switzerland). The selec...
Published in: | Environmental Economics |
---|---|
Main Authors: | , , |
Format: | Article in Journal/Newspaper |
Language: | English |
Published: |
LLC "CPC "Business Perspectives"
2022
|
Subjects: | |
Online Access: | https://doi.org/10.21511/ee.13(1).2022.01 https://doaj.org/article/b45cde2cf3e54597af2598a7c55eafb2 |
id |
ftdoajarticles:oai:doaj.org/article:b45cde2cf3e54597af2598a7c55eafb2 |
---|---|
record_format |
openpolar |
spelling |
ftdoajarticles:oai:doaj.org/article:b45cde2cf3e54597af2598a7c55eafb2 2023-05-15T16:52:10+02:00 Investigating the effects of environmental taxes on economic growth: Evidence from empirical analysis in European countries Jules-Eric Tchapchet-Tchouto Noukignon Koné Loudi Njoya 2022-06-01T00:00:00Z https://doi.org/10.21511/ee.13(1).2022.01 https://doaj.org/article/b45cde2cf3e54597af2598a7c55eafb2 EN eng LLC "CPC "Business Perspectives" https://www.businessperspectives.org/images/pdf/applications/publishing/templates/article/assets/16582/EE_2022_01_Tchouto.pdf https://doaj.org/toc/1998-6041 https://doaj.org/toc/1998-605X doi:10.21511/ee.13(1).2022.01 1998-6041 1998-605X https://doaj.org/article/b45cde2cf3e54597af2598a7c55eafb2 Environmental Economics, Vol 13, Iss 1, Pp 1-15 (2022) economic growth environmental tax policy European Countries (EU-28) European Environmental Agency Countries (EEA-32) OLS quantile analysis Environmental sciences GE1-350 article 2022 ftdoajarticles https://doi.org/10.21511/ee.13(1).2022.01 2023-01-22T01:32:04Z This paper empirically analyze the effects of environmental taxes on economic growth using data spanning the period 2009–2019 across 31 European countries (28 from the European Union, including the UK before Brexit, Iceland and Norway, which are candidates to join the EU, and Switzerland). The selected countries are also members of the European Environmental Agency countries (EEA-32). Baseline scenario with Pooled Ordinary Least Squares leads to the evidence that an increase of the environmental taxes in case of any tax policy reform will exacerbate economic growth. Robustness checks by introducing more control variables in response to omitted variables bias, coupling with GMM estimations that control for endogeneity concerns, consistently confirm the results. Deeping more with quantile analysis regression, a negative effect is confirmed in each quantile, and the results are significant at 1%. Nevertheless, there is a discrepancy between each quantile that allows highlighting evidence of countries’ threshold effects. In fact, low-income countries are more negatively affected than upper and medium-income countries. As the official communication of the EU Commission is always in demand of empirical research concerning the economic impacts of environmental policy instruments, the paper sheds light on the possibility of discussing and adapting the EU strategy based on a harmonization system. This evidence of differentiated effects among countries’ thresholds in the absence of any compensation may raise equity considerations within heterogeneous countries. Therefore, this paper fulfills the gaps in the inconclusive results in the existing literature. AcknowledgmentsAuthors would like to sincerely thank Ange Jusse Tchouto, Isaac Ketu, Arsene Mouongue Kelly for their invaluable support in this work, their helpful comments and suggestions on the previous draft of this paper. The usual disclaimer apply and views are the sole responsibility of the authors. Article in Journal/Newspaper Iceland Directory of Open Access Journals: DOAJ Articles Norway Environmental Economics 13 1 1 15 |
institution |
Open Polar |
collection |
Directory of Open Access Journals: DOAJ Articles |
op_collection_id |
ftdoajarticles |
language |
English |
topic |
economic growth environmental tax policy European Countries (EU-28) European Environmental Agency Countries (EEA-32) OLS quantile analysis Environmental sciences GE1-350 |
spellingShingle |
economic growth environmental tax policy European Countries (EU-28) European Environmental Agency Countries (EEA-32) OLS quantile analysis Environmental sciences GE1-350 Jules-Eric Tchapchet-Tchouto Noukignon Koné Loudi Njoya Investigating the effects of environmental taxes on economic growth: Evidence from empirical analysis in European countries |
topic_facet |
economic growth environmental tax policy European Countries (EU-28) European Environmental Agency Countries (EEA-32) OLS quantile analysis Environmental sciences GE1-350 |
description |
This paper empirically analyze the effects of environmental taxes on economic growth using data spanning the period 2009–2019 across 31 European countries (28 from the European Union, including the UK before Brexit, Iceland and Norway, which are candidates to join the EU, and Switzerland). The selected countries are also members of the European Environmental Agency countries (EEA-32). Baseline scenario with Pooled Ordinary Least Squares leads to the evidence that an increase of the environmental taxes in case of any tax policy reform will exacerbate economic growth. Robustness checks by introducing more control variables in response to omitted variables bias, coupling with GMM estimations that control for endogeneity concerns, consistently confirm the results. Deeping more with quantile analysis regression, a negative effect is confirmed in each quantile, and the results are significant at 1%. Nevertheless, there is a discrepancy between each quantile that allows highlighting evidence of countries’ threshold effects. In fact, low-income countries are more negatively affected than upper and medium-income countries. As the official communication of the EU Commission is always in demand of empirical research concerning the economic impacts of environmental policy instruments, the paper sheds light on the possibility of discussing and adapting the EU strategy based on a harmonization system. This evidence of differentiated effects among countries’ thresholds in the absence of any compensation may raise equity considerations within heterogeneous countries. Therefore, this paper fulfills the gaps in the inconclusive results in the existing literature. AcknowledgmentsAuthors would like to sincerely thank Ange Jusse Tchouto, Isaac Ketu, Arsene Mouongue Kelly for their invaluable support in this work, their helpful comments and suggestions on the previous draft of this paper. The usual disclaimer apply and views are the sole responsibility of the authors. |
format |
Article in Journal/Newspaper |
author |
Jules-Eric Tchapchet-Tchouto Noukignon Koné Loudi Njoya |
author_facet |
Jules-Eric Tchapchet-Tchouto Noukignon Koné Loudi Njoya |
author_sort |
Jules-Eric Tchapchet-Tchouto |
title |
Investigating the effects of environmental taxes on economic growth: Evidence from empirical analysis in European countries |
title_short |
Investigating the effects of environmental taxes on economic growth: Evidence from empirical analysis in European countries |
title_full |
Investigating the effects of environmental taxes on economic growth: Evidence from empirical analysis in European countries |
title_fullStr |
Investigating the effects of environmental taxes on economic growth: Evidence from empirical analysis in European countries |
title_full_unstemmed |
Investigating the effects of environmental taxes on economic growth: Evidence from empirical analysis in European countries |
title_sort |
investigating the effects of environmental taxes on economic growth: evidence from empirical analysis in european countries |
publisher |
LLC "CPC "Business Perspectives" |
publishDate |
2022 |
url |
https://doi.org/10.21511/ee.13(1).2022.01 https://doaj.org/article/b45cde2cf3e54597af2598a7c55eafb2 |
geographic |
Norway |
geographic_facet |
Norway |
genre |
Iceland |
genre_facet |
Iceland |
op_source |
Environmental Economics, Vol 13, Iss 1, Pp 1-15 (2022) |
op_relation |
https://www.businessperspectives.org/images/pdf/applications/publishing/templates/article/assets/16582/EE_2022_01_Tchouto.pdf https://doaj.org/toc/1998-6041 https://doaj.org/toc/1998-605X doi:10.21511/ee.13(1).2022.01 1998-6041 1998-605X https://doaj.org/article/b45cde2cf3e54597af2598a7c55eafb2 |
op_doi |
https://doi.org/10.21511/ee.13(1).2022.01 |
container_title |
Environmental Economics |
container_volume |
13 |
container_issue |
1 |
container_start_page |
1 |
op_container_end_page |
15 |
_version_ |
1766042315129880576 |