Please use this identifier to cite or link to this item: http://hdl.handle.net/10995/103328
Title: The social multiplier of environmental policy: Application to carbon taxation
Authors: Konc, T.
Savin, I.
van den Bergh, J. C. J. M.
Issue Date: 2021
Publisher: Academic Press Inc.
Citation: Konc T. The social multiplier of environmental policy: Application to carbon taxation / T. Konc, I. Savin, J. C. J. M. van den Bergh. — DOI 10.1016/j.jeem.2020.102396 // Journal of Environmental Economics and Management. — 2021. — Vol. 105. — 102396.
Abstract: We analyze the effectiveness of environmental policy when consumers are subject to social influence. To this end, we build a model of consumption decisions driven by socially-embedded preferences formed under the influence of peers in a social network. This setting gives rise to a social multiplier of environmental policy. In an application to climate change, we derive Pigouvian and target-achieving carbon taxes under socially-embedded preferences. Under realistic assumptions the social multiplier is equal to 1.30, allowing to reduce the effective tax by 38%. We show that the multiplier depends on four factors: strength of social influence, initial taste distribution, network topology and income distribution. The approach provides a basis for rigorously analyzing a transition to low-carbon lifestyles and identifying complementary information and network policies to maximize the effectiveness of carbon taxation. © 2020 Elsevier Inc.
Keywords: CARBON PRICING
CLIMATE POLICY
ENDOGENOUS PREFERENCES
EXTERNALITY TAXATION
SOCIAL NETWORK
CARBON
CLIMATE CHANGE
EMISSION CONTROL
ENVIRONMENTAL PROTECTION
TAXATION
CARBON TAXATION
CARBON TAXES
ENVIRONMENTAL POLICY
INCOME DISTRIBUTION
LOW-CARBON LIFESTYLES
NETWORK POLICY
NETWORK TOPOLOGY
SOCIAL INFLUENCE
ECONOMIC AND SOCIAL EFFECTS
CARBON
CLIMATE CHANGE
ENVIRONMENTAL POLICY
NETWORK ANALYSIS
NUMERICAL MODEL
SOCIAL NETWORK
TOPOLOGY
URI: http://hdl.handle.net/10995/103328
Access: info:eu-repo/semantics/openAccess
SCOPUS ID: 85096364178
PURE ID: 20114753
d622ca3c-af20-4be5-98a4-5c366135b86b
ISSN: 950696
DOI: 10.1016/j.jeem.2020.102396
metadata.dc.description.sponsorship: This work was supported by an ERC Advanced Grant under the European Union's Horizon 2020 research and innovation program [grant agreement Nr. 741087 ]. I.S. acknowledges support from the Russian Science Foundation [RSF grant number 19-18-00262 ]. We have greatly benefited from comments by Stefano Carattini, Diego d’Andria, Rick van der Ploeg and Cees Withagen on an earlier version of the manuscript. We thank the three anonymous reviewers and the editor whose suggestions helped improve and clarify this manuscript. We also thank the participants of the INET Oxford Visitor Seminar and a seminar at the Mercator Research Institute on Global Commons and Climate Change. The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper.
RSCF project card: 19-18-00262
CORDIS project card: 741087
Appears in Collections:Научные публикации, проиндексированные в SCOPUS и WoS CC

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