Academic journal article Journal of Comparative Politics

The Influence of Ecological Taxes on the Exposure of Waste and Co2 Emissions in a Selected Group of Eu Countries

Academic journal article Journal of Comparative Politics

The Influence of Ecological Taxes on the Exposure of Waste and Co2 Emissions in a Selected Group of Eu Countries

Article excerpt

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Economic growth leads to the increased pollution of nature. This effect comes from the supply side (production of goods, provision of services) as well as from the demand side (household consumption, investments, state spending and exports). The state has the possibility and duty to limit the burden on the environment by direct regulation (prohibitions, etc.), by leading a specific approach to development policy (promoting the introduction of cleaner technologies) and through tax policy. In this article we analyse the effectiveness of its environmental tax measures based on data from continental EU Member States.

The article starts with a short outline of economic theory on pollution and the role of ecological levies, followed by the presentation of the methodology, the data used and the estimated model of the impact of various factors on the generation of waste and CO2 emissions. Below is the outline on how change in environmental taxation affects deposited waste and CO2 emissions. In the last part of the article an example of the effectiveness of the landfill tax on the disposal of waste at landfills is specifically illustrated. The end of the article presents the conclusions, an indication of the literature used, data sources and the software used.


Economizing is a conscious human activity to reduce the required limited resources for meeting our needs. These resources are called goods. In the process of economizing, the consumers maximize their utility and the producers maximize their profits. One and all act in accordance with the prices of goods as they are established on the market in the relation between supply and demand (Kneese and Clifford 1994). In most cases the production and consumption of goods cause negative externalities or external diseconomies, which are not included in prices as established in the relation between the supply and demand of these goods.2 This fact represents a market failure. The first economic thinker to theoretically explain it was Arthur Pigou (1920), the successor to Alfred Marshall at Cambridge University. As a solution, he proposed the introduction of an ecological tax. Of course, apart from this economic incentive to limit or even prevent pollution, the state also operates through direct regulation and subsidies. An economic analysis of the effectiveness of various measures to reduce pollution and to eliminate external diseconomies has been in constant development since the 1970s (Kneese and Bower 1979). External diseconomies or different forms of pollution are on one side increasing with the growth of the production and consumption of goods, and on the other side they decrease with state regulation, investments in clean technologies and ecological taxes. Which of the instruments the regulator (the state) elects to use depends on how producers are able to respond to the price signals of environmental taxes. If the cost of reducing pollution is low, environmental taxes are effective; otherwise, direct bans are more effective (Weitzman 1974; Stavins 1996). When the state combines ecological taxes with other measures (licenses) to reduce certain pollution, it must also take into account the interaction effect of limiting the emissions of one pollutant on the emissions of other pollutants, i.e. that the goods associated with this pollution exist in a complementary or substitute relation (Ambec and Coria 2013). In models of endogenous growth (Romer 1986; Romer 1990) environmental policy measures (including ecological taxation) influence the choice of technologies and the structure of the economy (Soretz 2007). Market power or a monopoly of polluting economic subjects increases the importance of tax regulation in relation to prohibitions (Heuson 2010). In North-South international trade, however, synchronized environmental tax policy cannot prevent distortion in the allocation of resources (Daubanes and Grimaud 2010). …

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