Distortionary, Non-Distortionary, and Distributional Properties of Environmental Taxes: Extension of Sandmo's Observation

Distortionary, Non-Distortionary, and Distributional Properties of Environmental Taxes: Extension of Sandmo’s Observation

We find a limited parallel between lump-sum taxes and environmental taxes. Corollary 2, which extends Sandmo’s observation, shows that appropriated corrective revenues have the same non-distortionary effects as lump-sum taxes, the result reducing to the original observation when the appropriated corrective revenues meet the revenue need and achieve first-best efficiency with other taxes set at ...

Health care evaluation, utilitarianism and distortionary taxes.

Cost Utility Analysis (CUA) and Cost Benefit Analysis (CBA) are methods to evaluate allocations of health care resources. Problems are raised for both methods when income taxes do not meet the first best optimum. This paper explores the implications of three ways that taxes may fall short of this ideal. First, taxes may be distortionary. Second, they may be designed and administered without ref...

Environmental Investment and Policy with Distortionary Taxes and Endogenous Growth

Recent studies consider public R&D spending that affects abatement knowledge and endogenous growth, distortionary taxes that affect physical and human capital formation, pollution taxes that affect environmental degradation, and regeneration that restores natural capital. Our model combines all of those elements. We show how the combination affects results from each prior model, focusing on two...

Environmental Levies, Distortionary Taxation and Increasing Returns

In this note, we introduce increasing returns to Bovenberg and Mooij’s (1994) model as generalised in Fullerton (1997) and use an example to show that (1) even with a distortionary labor tax, the optimal environmental levy is greater than the Pigouvian rate; (2) the difference between tax on the “dirty” good and the “clean” good is also greater than the Pigouvian tax; (3) under certain circumst...

Benefit-Cost Analysis and Distortionary Taxes: A Public Choice Approach