Effects of Implementation of Green Tax on Environmental Pollutants’ Dispersion on Macroeconomic Variables: Application of Multi-Regional General Equilibrium Model

Document Type : Research Paper

Authors

Department of Agricultural Economics, Marvdasht Branch, Islamic Azad University, Marvdasht, Iran

Abstract

The present paper aims to determine the effects of various scenarios of green tax burden on pollution dispersion and multiple macro-economic variables such as GDP along with welfare and inflation. In addition, the effects of technical progress on major pollutant industries such as coal, oil and gas were evaluated. For this purpose general multiregional equilibrium method (GTAP-E) was used. The results of the study indicated that under low tax rate scenario, GDP remained unchanged. Increase in the carbon tax rate would not followed by increase in GDP. Energy consumption and social welfare increased but inflation decreased. Furthermore, increase in efficiency along with advance technology caused reduction in dispersion of environmental pollutants along with GDP growth and consequent increase in government tax revenue.

Keywords

References

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Caspian Journal of Environmental Sciences
Volume 18, Issue 2
April 2020
Pages 181-192

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